Eight financial influencers accused in a $100 million stock manipulation scheme
The promise was simple: follow them and get rich.
Eight influencers, from California to Florida, have promoted themselves on social media as financial gurus who can pick winning stocks.
But the federal authorities said it was in fact a “pump and dump” scheme in which perpetrators inflated stock prices and paid them off as good investments before dumping them for profit.
In parallel cases brought by the US Attorney’s Office for the Southern District of Texas and the US Securities and Exchange Commission, authorities said the eight influencers made more than $100 million by selling stocks they promoted at artificially inflated prices.
With 1.5 million Twitter followers, the defendants used their social media to send “false and misleading information” about the stocks they pumped and dumped as part of the scheme, federal prosecutors said Wednesday.
“In addition to their Twitter presence, the Defendants also allegedly operated an online community for individual stock traders called Atlas Trading, which the Defendants promoted as one of the world’s largest free online communities of individual stock traders and which had a chat room called Atlas,” prosecutors said. Dealing with disagreement.
Authorities believe the defendants made at least $114 million through the scheme from January 2020 to April 2022.
According to the SEC, seven of the defendants — including Beverly Hills residents Thomas Cooperman, 34, and Gary Dale, 28 — carried out the scheme by coordinating a stock takeover, promoting shares to followers and dumping them for “significant profits.”
The SEC also alleged that the eighth defendant co-hosted a stock trading podcast that promoted the co-defendants as expert traders and “provided a platform for the co-defendants to misleadly promote the stock they intended to dispose of.”
On Twitter, Cooperman and Dale describe themselves as multi-millionaire day traders and founders of the “Goblin Gang” YouTube channel.
As further alleged in the indictment, the defendants used their credibility on social media to maximize their own profits at the expense of their followers, presenting themselves as skilled stock traders by posting pictures displaying their profits and extravagant lifestyles and encouraging people to follow them on social media in order to share in their financial gains. prosecutors said.
All eight defendants are charged with conspiracy to commit securities fraud.
Prosecutors said Edward Constantinescu, also known as Constantin, 38, of Montgomery, Texas, also faces three counts of securities fraud and one count of engaging in monetary transactions in property derived from a specified illegal activity.
Prosecutors said Dale and Perry “PJ” Matlock, 38, of The Woodlands, Texas, are charged with five counts of securities fraud. John Reparczyk, 32, of Spring, Texas, faces four counts of securities fraud.
Cooperman. Stefan Harvatin, 35, of Miami. Authorities said he and Mitchell Hennessy, 23, of Hoboken, New Jersey, have each been charged with two counts of securities fraud.
Prosecutors said the defendants appeared in court for the first time on Tuesday. If convicted, prosecutors said, they face maximum penalties of up to 25 years in federal prison.
Authorities said Constantinescu faces an additional maximum sentence of 10 years in prison if he is convicted of involvement in illegal monetary transactions.
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