The Securities and Exchange Commission (SEC) alleges eight social media influencers, as for years they have promoted themselves as trustworthy stock-picking gurus.
The SEC Allegation
According to the SEC lawsuit, filed on Dec. 13, 2022, the eight social media influencers were engaged in a pump-and-dump stock manipulation scheme that fleeced their followers out of $100 Million.
The eight social media influencers are:
- Edward Constantin, a/k/a “MrZackMorris,” a/k/a “Edward Constantinescu,”
- Perry Matlock, a/k/a “PJ Matlock,”
- Thomas Cooperman, a/k/a “Tommy Coops,”
- Gary Deel, a/k/a “Mystic Mac,”
- Mitchell Hennessey, a/k/a “Hugh Henne,”
- Stefan Hrvatin, a/k/a “LadeBackk,”
- Daniel Knight, a/k/a “Deity of Dips,” and
- John Tybarcyzk, a/k/a “Ultra Calls,” a/k/a “The Stock Sniper,”
In its lawsuit, SEC states that “all the eight social media influencers promoted themselves as trustworthy. But, in reality they are seasoned stock manipulators. They all identify stocks ripe for manipulation, and acquire substantial positions in these securities. They also recommend those stocks as good investments to their followers on Twitter, in online stock-trading forums they run, and on podcasts.”
The social media influencers encouraged their followers to purchase the selected stocks, often claiming that they also have bought or intend to buy these stocks for themselves and hold them. Instead, they sell their shares into the demand that their deceptive promotions generate.
The lawsuit states seven of the social media influencers—Perry Matlock, Edward Constantin, Thomas Cooperman, Gary Deel, Mitchell Hennessey, Stefan Hrvatin, and John Rybarcyzk carried out the scheme. They were coordinating the acquisition of shares, promoting the shares to their followers, and dumping the shares for substantial profits. Also, were aided and abetted by Daniel Knight, who with Hennessey, co-hosted a popular stock-trading podcast that promoted the other defendants as expert traders and provided a platform for other defendants to deceptively promote the stocks they intended to dump.
“From at least January 2020 through present (the “Relevant Period”), all the social media influencers earned approximately $100 Million from this stock-manipulation scheme.”
According to the SEC lawsuit, “Constantin, Matlock, Cooperman, Deel, Hennessey, Hrvatin, and Rybarcyzk are referred to as the “Primary Suspects.” They deceptively promoted stocks through three channels: stock-trading forums on Discord; podcasts; and Twitter.”
In its second claim for relief fraud in connection, SEC added “Constantin, Matlock, Cooperman, Deel, Hennessey, Hrvatin, and Rybarcyzk are directly or indirectly, in connection with the purchase or sale of securities, by the use of the means or instrumentalities of interstate commerce or of the mails, or of any facility of any national securities exchange, intentionally, knowingly or recklessly.”
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.
Source: https://www.thecoinrepublic.com/2022/12/15/sec-cracks-down-on-social-media-influencers-find-here-why/