Keith Gill, or “Roaring Kitty” as he was known online, has been sued for securities fraud for allegedly misrepresenting himself as an amateur investor amid the GameStop controversy, Bloomberg reported on Wednesday (Feb. 17).
He was accused of using that misrepresentation to profit through artificially increasing stock prices.
The class-action lawsuit, filed Tuesday (Feb. 16) in federal court in Massachusetts, says Gill was just using the GameStop stock frenzy to benefit himself. Gill was working at the time as a licensed securities professional. The GameStop events saw retail traders, united in a Reddit board, coming together to inflate the prices of stocks like GameStop and AMC that were bet to be losers by large hedge funds. The ensuing chaos resulted in brokerages shutting down trading for the stocks. Since then, the prices have evened out to what they were before.
On social media, Gill relentlessly touted the GameStop shares, Bloomberg writes, including on YouTube, Twitter and Reddit.
“Gill’s deceitful and manipulative conduct not only violated numerous industry regulations and rules, but also various securities laws by undermining the integrity of the market for GameStop shares,” the suit said. “He caused enormous losses not only to those who bought option contracts, but also to those who fell for Gill’s act and bought GameStop stock during the market frenzy at greatly inflated prices.”
Gill, reports say, was far from being an amateur stock picker, as he worked as a chartered financial analyst and had multiple broker licenses.
The GameStop run has opened up a new conversation about financial literacy, which usually wasn’t a focal point with that sector before. Now, the conversation has shifted to thinking and talking about money in new ways. According to Yinon Ravid, CEO of the app-based advisory firm Albert, some of the things necessary to talk about finances in positive ways include expert advice as well as a level of fine guidance and automation that makes the processes simpler for consumers.