Ebene News – CA – ‘Roaring Kitty’ Sued for Securities Fraud over GameStop Rise

Keith Gill, one of the most influential voices to push GameStop on the WallStreetBets Reddit forum, has been hit with a lawsuit that accused him of falsely portraying himself as an amateur investor and profit by artificially inflating the share price

The proposed class action lawsuit against Gill, who adopted YouTube’s nickname “Roaring Kitty,” was filed in Massachusetts federal court on Tuesday The lawsuit said Gill was in fact a licensed securities professional who was manipulating the market for a profit Gill touted GameStop shares via an extensive social media presence on YouTube, Twitter and Reddit, where he used an alias more obscene

“Gill’s deceptive and manipulative conduct not only violated many industry regulations and rules, but also various securities laws by undermining the integrity of the GameStop stock market,” the lawsuit says “It caused huge losses not only to those who bought options contracts, but also to those who succumbed to Gill’s act and bought GameStop shares during the market frenzy at heavily inflated prices.”

The lawsuit was filed by securities class action firm Hagens Berman Sobol Shapiro on behalf of Washington State’s Christian Iovin and people in a similar situation Iovin sold $ 200,000 in call options on GameStop shares when the stock was below $ 100 The stock quickly eclipsed $ 400 a share, forcing him to buy back calls at high prices

Gill became one of the public faces of the GameStop rally that has been a Wall Street obsession this year The stock’s stratospheric rise appeared to pit disjointed individual investors against sophisticated hedge funds that were heavily selling the struggling retailer of the mall Some funds lost billions of dollars to cover their positions as GameStop shares jumped more than 1,700% in a period in January

The GameStop rally has also caught the attention of politicians, and Gill is expected to testify before the House Financial Services Committee on Thursday, along with executives from Robinhood Markets, Citadel, Melvin Capital Management and Reddit

In testimony prepared for his appearance before Congress, provided in advance by his attorney in response to questions about the lawsuit, Gill said his previous work in the financial industry had never included trading in securities or advice to clients He also denied attempting to artificially inflate GameStop stock and said he truly believes in the company’s future potential.

“I did not solicit anyone to buy or sell the stock for my own profit,” says Gill “I didn’t belong to any group trying to create movement in the stock price I never had a financial relationship with any hedge fund I had no information on GameStop except what was public I didn’t know anyone within the company and I have never spoken to any insider “

It’s unclear how much money Gill made from his GameStop shares, although he testified that he and his family were “millionaires” when the stock hit $ 20 in December, though. below the levels it would reach a month later Those gains have largely evaporated in recent weeks, with the stock falling 7% Wednesday to 4594

Lawsuit claims Gill, whom Bloomberg, The New York Times, The Wall Street Journal and others have talked about a lot about, was far from an amateur headlines picker Rather, he is a chartered financial analyst who holds multiple broker licenses and was previously employed by Massachusetts Mutual Life Insurance Co.The lawsuit also named MassMutual and a brokerage affiliate of the company as defendants, claiming they had an obligation to supervise Gill’s market activities

A spokesperson for the insurer said the company is reviewing the matter and has no comment

“In order to motivate hobby traders, Gill has shaped himself as a sort of Robin Hood and called securities professionals bad guys,” lawsuit says “Gill, however, is no hobbyist For many years, he worked actively as a professional in the investment and finance industries”

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Roaring Kitty, Keith Gill

Ebene News – CA – ‘Roaring Kitty’ Sued for Securities Fraud over GameStop Rise

Source: https://www.latimes.com/business/story/2021-02-17/roaring-kitty-sued-for-securities-fraud-over-gamestop-rise