Roaring Kitty goes quiet as regulators circle
Keith Gill’s cheerleading of GameStop stock made him an icon among Reddit-based traders during the recent meme-stock rally, and may have minted him a fortune — on paper at least. But Massachusetts authorities are now looking at whether he broke securities rules, The Times’s Matthew Goldstein reports, as regulators there and at the federal level investigate possible market manipulation in the trading frenzy.
At issue is Mr. Gill’s side gig as a stock commentator. Until last week, he worked in marketing at the insurer MassMutual and he’s a registered securities broker. But he was better known to the outside world for his Roaring Kitty YouTube channel and his posts on Reddit’s WallStreetBets under a profane name unprintable here, in which he talked up GameStop stock. (His YouTube videos contained a disclaimer that viewers should consult a financial adviser before investing.) He hadn’t disclosed all that to MassMutual or to the financial authority Finra, a failure that Massachusetts’ securities regulator, William Galvin, is examining.
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MassMutual told Mr. Galvin’s office that, had it known about Mr. Gill’s activities, it would have asked him to stop or fired him.
Representative Maxine Waters, the head of the House Financial Services Committee, wants Mr. Gill to testify at a Feb. 18 hearing on the meme-stock trading, which will also feature the Robinhood chief Vlad Tenev.
Mr. Gill himself hasn’t posted a YouTube video since Jan. 22, and wrote on Reddit yesterday that he would “back off the daily updates” of his GameStop trading position “for now.”
Meanwhile, the S.E.C. is reportedly combing through social media posts for fraud. The commission is looking for misinformation that may have spurred the market frenzy, while also examining trading data to see if messages and transactions match up, Bloomberg reports. Reddit has also said that its content filters blocked a “large amount” of posts by bots, adding to concerns about manipulation.
In more meme-stock news: Among the biggest winners from the GameStop rally were a Morgan Stanley mutual fund and the hedge fund Senvest Management. A book about the trading mania by Ben Mezrich, whose “The Accidental Billionaires” was the basis for the movie “The Social Network,” was sold to Hachette. And here’s Robinhood’s forthcoming Super Bowl ad, with the pitch, “We are all investors.”
The New York Times
Me: Ouch
