The U.S. Securities and Exchange Commission (SEC) has charged a group of social media influencers with running a pump-and-dump stock scheme that earned them $114 million U.S.
The eight men involved in the social media plot hyped stocks online to their followers without disclosing that they planned to sell the securities once the prices rose.
The influencers, who have been charged under U.S. securities laws, are between the ages of 23 and 38. They have been charged with conspiracy to commit securities fraud, which carries a maximum penalty of 25 years in prison each.
Seven of the men are also charged with other financial crimes in the alleged pump-and-dump scheme, according to the SEC and U.S. Department of Justice.
On social media platforms such as %Twitter and %Discord, the group promoted themselves as successful traders and posted images of themselves living an extravagant lifestyle.
They are also accused of posting false news and information about the stocks they promoted to artificially drive up the share price, according to the SEC.
The alleged crimes took place between January 2020 and April 2022. Each of the accused had over 100,000 Twitter followers that they communicated with regularly.
The group ran an online community for stock traders called “Atlas Trading.” They also ran a chatroom called “Atlas Trading Discord,” which they used to spread false and misleading information about stocks they quickly dumped once the price moved higher.
Criminal charges were filed against the eight men in the U.S. Court for the Southern District of Texas. Prosecutors have not said which stocks the accused promoted online.