In an alleged $100 million plot to manipulate stock prices using their Twitter and Discord accounts, the Securities and Exchange Commission has accused eight social media influencers with securities fraud, the agency announced on Wednesday.
The influencers are charged with advocating equities they had bought and declared they intended to hold to their throngs of fans in the complaint. Instead, they liquidated their shares without revealing their intention to dump the securities when prices and trade activity rose.
The SEC claims that the defendants carried out the scam by first choosing a security to manipulate and then disclosing the stock’s name to other members of the group, giving each of them the chance to buy shares at a discount before the manipulation. Then, in order to increase demand and drive up the share price, they pushed the stock to their followers, frequently by spreading incorrect or deceptive information about the assets they were pushing.
The complaint was submitted on Tuesday in Texas federal court and states that “typically, the Primary Defendants set price objectives, teased forthcoming news regarding the company, and/or stated their desire to buy shares or keep their current positions for longer durations.”
According to the complaint, the influencers removed old tweets and Discord talks in an effort to hide their scheme, which dates back at least to January 2020.
According to the lawsuit, among others, the influencers mismanaged the share prices of Camber Energy, Alzamend Neuro, and Vislink Technologies.
According to the complaint, “the eight defendants have, for years, represented themselves as reliable stock-picking gurus to their legions of followers on social media.” They are skilled stock manipulators in reality.
Perry Matlock, Edward Constantin, Thomas Cooperman, Gary Deel, Mitchell Hennessey, Stefan Hrvatin, and John Rybarczyk are among the defendants mentioned in the complaint for allegedly taking part in the pump-and-dump plan. Daniel Knight, who co-hosted a well-known stock trading podcast with Hennessey and advertised the influencers as knowledgeable traders, helped them. Co-founders of Atlas Trading, a well-known stock trading community on Discord, are Matlock and Constantin.
