SEC Takes Down "Influencers" in $100 Million Stock Manipulation Scheme

SEC Charges Eight Social Media Influencers in $100 Million Stock Manipulation Scheme Promoted on Discord and Twitter

The Securities and Exchange Commission today announced charges against eight individuals in a $100 million securities fraud scheme in which they used the social media platforms Twitter and Discord to manipulate exchange-traded stocks.

According to the SEC, since at least January 2020, seven of the defendants promoted themselves as successful traders and cultivated hundreds of thousands of followers on Twitter and in stock trading chatrooms on Discord. These seven defendants allegedly purchased certain stocks and then encouraged their substantial social media following to buy those selected stocks by posting price targets or indicating they were buying, holding, or adding to their stock positions. However, as the complaint alleges, when share prices and/or trading volumes rose in the promoted securities, the individuals regularly sold their shares without ever having disclosed their plans to dump the securities while they were promoting them.

“As our complaint states, the defendants used social media to amass a large following of novice investors and then took advantage of their followers by repeatedly feeding them a steady diet of misinformation, which resulted in fraudulent profits of approximately $100 million,” said Joseph Sansone, Chief of the SEC Enforcement Division’s Market Abuse Unit.

Sam Bankman-Fried’s ‘chronically overcrowded’ Bahamas jail is infested with rats and maggots

Fallen crypto giant Sam Bankman-Fried will be remanded in custody in the Bahamas in a prison that was described in 2019 as ‘not being fit for humanity.’

On Tuesday, a judge in Nassau ordered that the FTX founder be held without bail while he fights extradition to the United States on a range of charges that include securities and wire fraud.

SBF, 30, had argued that he should be granted a $250,000 bail and house arrest because of his veganism, depression and dependency on medication.

Instead, Chief Magistrate Joyann Ferguson-Pratt ordered that SBF must spend the next two months at the Bahamas’ infamous Fox Hill prison, known for its rodent infestations, violence and the mixing of children with adult prisoners, before his next court appearance on February 8.

SEC’s Gensler faces scrutiny over FTX and crypto implosions

The arrest of FTX founder Sam Bankman-Fried this week amid charges of a billion-dollar fraud corroborates long-standing warnings from critics who have likened the cryptocurrency markets to the Wild West. The question is: Where was the sheriff?

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In the wake of the multibillion-dollar collapse of FTX, some U.S. lawmakers are looking to Gensler’s SEC for a fuller accounting: How did the industry grow so fast — the total value of crypto tokens peaked at $3 trillion a year ago — without the SEC imposing more safeguards on digital assets and the platforms that allow investors to trade them?

Gensler met with Democrats on the House Financial Services Committee last week and at least some of those who have previously defended him were unsatisfied with his answers.

SEC Toughens Insider Trading Rules for Execs, Limits ProtectionsThe SEC is restricting when top executives can unload company shares and is forcing them to disclose more information about their planned stock sales as part of a renewed effort to combat insider trading.

The Securities and Exchange Commission on Wednesday voted unanimously to adopt rules that will require company directors and officers to wait at least 90 days between when they schedule a trade and sell their shares, about a month less than initially proposed. Companies also will have to report on their executives’ use of trading plans in quarterly reports.

Tom Brady pushed FTX, then the crypto firm failed. Should he pay up?

When Michael Livieratos saw quarterback Tom Brady in a commercial for the cryptocurrency trading platform FTX, he knew exactly where he wanted to put his $30,000 crypto investment.

“As a New England Patriots fan my entire life, you can imagine the influence that Tom Brady would have,” said Livieratos, a 56-year-old legal clerk who lives in Connecticut. He soon moved nearly all his money from another crypto exchange to FTX.

Then FTX filed for bankruptcy in a spectacular collapse that vaporized at least $10 billion in assets, according to bankruptcy filings, including all the money Livieratos had on the platform. Now he is a plaintiff in a proposed class-action lawsuit that seeks to hold Brady, his supermodel ex-wife, Gisele Bündchen, and nine other celebrity endorsers of FTX financially responsible for luring him into a very bad deal.

US Senators Warren, Marshall Introduce Digital Assets Anti-Money Laundering Bill

U.S. Senators Elizabeth Warren (D-Mass.) and Roger Marshall (R-Kan.) are introducing a bill to crack down on money laundering and financing of terrorists and rogue nations via cryptocurrency.

If it becomes law, the Digital Asset Anti-Money Laundering Act will bring know-your-customer (KYC) rules to crypto participants such as wallet providers and miners and prohibit financial institutions from transacting with digital asset mixers, which are tools designed to obscure the origin of funds.

FTX Hearing in US Senate Reveals Congress Doesn’t Have Immediate Answers

The crypto industry is calling for U.S. regulations as the epic failure of FTX drags at the sector. Most regulators say they can’t do the job without more powers from Congress. So far, a sound-and-fury campaign from lawmakers hasn’t shown a path forward.

Any path will almost certainly depend on Sen. Sherrod Brown (D-Ohio), the chairman of the Senate Banking Committee, who concluded an FTX hearing Wednesday with a pointed question:

“Do you think crypto platforms could mostly comply with actual regulations?” he asked of witness Hilary Allen, a professor at American University’s law school who is a critic of the digital assets industry. “No, I don’t,” she said. “And I think when they’re calling for regulator clarity, what they’re asking for actually is bespoke regulation that they can comply with.”

“Good answer,” he said.

Goldman Sachs weighs bonus cut of at least 40% at investment bank

Goldman Sachs is considering shrinking the bonus pool for its more than 3,000 investment bankers by at least 40 per cent this year, as chief executive David Solomon tries to control costs with deeper cuts than many of its Wall Street rivals.

The final bonus pools at Goldman are still being decided but the prospect of the deep cuts has fed fears that the bank could face high staff turnover in the new year, according to people familiar with the matter.

“I think we’re going to be worse than the Street,” one senior Goldman banker said.