8 Social Media Influencers Charged by the SEC: Stock Manipulation Scheme Uncovered
In a landmark case highlighting the growing intersection of social media and finance, the Securities and Exchange Commission (SEC) and federal prosecutors have cracked down on alleged securities fraud. U.S. prosecutors have announced charging eight social media influencers in a securities fraud scheme, alleging that they used platforms like Twitter and Discord to... manipulate stock prices and defraud investors.
The case, announced Wednesday, involves eight individuals accused of orchestrating a complex scheme to inflate the value of specific stocks, netting an estimated $114 million in illicit profits. WASHINGTON (Reuters) -U.S. prosecutors on Wednesday said they have charged eight individuals in a securities fraud scheme, alleging they reaped about $114 million... through their coordinated efforts on social media.
Details of the Alleged Scheme
The SEC\'s investigation revealed a coordinated effort by the influencers to promote specific stocks to their large online followings. By making false and misleading statements about these companies, they artificially inflated stock prices. The Securities and Exchange Commission has charged seven Twitter users and a podcaster in an alleged $100 million stock manipulation scheme run through social... media.
This alleged "pump and dump" scheme involved the influencers touting specific stocks on platforms like Twitter and Discord, then selling their own shares after the price had risen due to the artificial demand created by their followers. The SEC alleges the influencers profited handsomely from this illegal activity.
Who Are the Accused?
While the full list of names and profiles is still unfolding, the SEC confirms that the individuals charged include seven active Twitter users and one prominent podcaster. These "social media influencers" had built substantial followings, leveraging their popularity to influence investment decisions.
The SEC charged seven “social media influencers” who had amassed hundreds of thousands of followers on Twitter and Discord with securities fraud, alleging... that they violated securities laws by engaging in manipulative practices.
Consequences and Legal Ramifications
The consequences for the accused are severe. Federal prosecutors and the Securities and Exchange Commission charged eight social-media influencers over an alleged stock-manipulation scheme in which they used... their platforms to commit securities fraud. They face potential criminal charges, including securities fraud, wire fraud, and conspiracy. Additionally, the SEC is seeking civil penalties, including disgorgement of ill-gotten gains and permanent injunctions barring them from participating in similar schemes in the future.
This case serves as a stark reminder of the importance of due diligence when investing based on information gleaned from social media. Investors are urged to be wary of unsubstantiated claims and to conduct their own independent research before making investment decisions.