Posted on 12/14/2022 9:38:28 AM PST by Red Badger
Eight social media influencers and self-proclaimed day traders were charged with fraud for promoting a $100 million "pump and dump" scheme.
The Securities and Exchange Commission announced on Wednesday that it was charging the investors with securities fraud due to the eight men using their large followings on Twitter and Discord to encourage investors to buy certain stocks. As the prices rose, the influencers then sold the shares without disclosing their plans to do so.
"As our complaint states, the defendants used social media to amass a large following of novice investors and then took advantage of their followers by repeatedly feeding them a steady diet of misinformation, which resulted in fraudulent profits of approximately $100 million," said Joseph Sansone, chief of the SEC Enforcement Division's Market Abuse Unit, in a press statement.
The SEC named Perry Matlock, Edward Constantin, Thomas Cooperman, Gary Deel, Mitchell Hennessey, Stefan Hrvatin, and John Rybarczyk as being involved in the scheme.
The commission also charged Daniel Knight, a stock-trading podcast host known as the "Deity of Dips," for promoting the other seven traders as "expert traders" and providing them a platform to sell their stock recommendations.
The charges serve as "another warning that investors should be wary of unsolicited advice they encounter online," Sansone concluded.
The Motley Fools?
“.....investors should be wary of unsolicited advice they encounter online,,,,”
Including that from the SEC.
I had heard the Big 12 was after them, but to also run up against the SEC is serious business.
I always get my financial advice from complete strangers online. Especially ones from Nigeria and Myanmar...................
“self-proclaimed day traders”
Aren’t all day traders “self-proclaimed”? Or is there some industry regulatory or licensing body that is supposed to grant that status that I have missed out on?
Me too. Also that cool dude in the Bahamas.
“resulted in fraudulent profits of approximately $100 million”
Peanuts compared to FTX. These guys should have gotten into crypto if they wanted to scam the big bucks. And they should have donated profligately to the Democrats.
When evaluating stock tips online think of the old poker adage: “If you can’t spot the sucker at the table, then you’re the sucker”
“I always get my financial advice from complete strangers online. Especially ones from Nigeria...”
You’ve got to be careful. I only listen to ones that are deposed princes, or at least former generals. And only if they tell me to “have a blessed day”.
Jim Cramer to the white courtesy telephone please.
Jim Cramer to the white courtesy telephone please.
There actually is a Regulatory Definition...
See Paragraph (e) https://www.finra.org/rules-guidance/rulebooks/finra-rules/2130
If you watch him, he will actually tell you which ones of the stocks he is pimping that he actually owns. He is required to.
These folks did not. They were also required to.
They need to go after the financial influencers on YouTube as well, who steered many of their followers into scams like FTX that they (the influencers) likely benefitted personally from.
The SEC should be more concerned about the Tide being robbed. The Horned Frogs lost to K State. New Year’s eve, when the Tide blows out the Purple Pride all of America should realize that the H Frogs and The Ohio State have no place in the playoffs.
Shocking that a social media influencer would be a paid shill. Shocking, I say!
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