Home CryptoAlameda Social Media Influencers and Investing

Social Media Influencers and Investing

by S. Jack Heffernan Ph.D

If you make any decision based on the opinion of a Social Media Influencer, you are an idiot.

Social media influencers are paid muppets who have the power to influence other muppets through social media. They have established zero credibility and a following within a specific industry or niche and use their influence to shape public perception of a product, service, or brand.

Social media influencers typically use their personal accounts on platforms such as Instagram, YouTube, and Twitter to share content related to a particular brand or product. This content may be in the form of sponsored posts, product reviews, tutorials, or giveaways. Influencers are often seen as more authentic than traditional advertising, and this helps brands to build trust with the customers that have a subpar IQ.

It is important to remember that social media influencers may not always have your best interests in mind when giving advice or promoting products. It is important to do your own research and make informed decisions based on accurate information. Additionally, it is important to remember that you are not obligated to follow or take advice from any influencer, regardless of their popularity or following.

They are circus monkeys that are there for your entertainment.

If you are a Social Media Influencer and you are yelling buy buy buy on a crypto or stock and you are selling then you have broken some laws and may well be the subject of an investigation in the future.

Serious trouble is coming some

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. “Today’s action exposes the true motivation of these alleged fraudsters and serves as another warning that investors should be wary of unsolicited advice they encounter online.”

The following seven individuals were charged with securities fraud:

Name                           State of Residence      Twitter Handle

Perry Matlock               Texas                            @PJ_Matlock            

Edward Constantin       Texas                           @MrZackMorris

Thomas Cooperman    California                     @ohheytommy

Gary Deel                     California                     @notoriousalerts

Mitchell Hennessey      New Jersey                  @Hugh_Henne

Stefan Hrvatin              Florida                         @LadeBackk

John Rybarcyzk           Texas                           @Ultra_Calls

The complaint further charges Daniel Knight (Twitter Handle @DipDeity), of Texas, with aiding and abetting the alleged scheme by, among other things, co-hosting a podcast in which he promoted many of the other individuals as expert traders and provided them with a forum for their manipulative statements. Knight also traded in concert with the other defendants and regularly generated profits from the manipulation.

The SEC’s complaint, filed in the U.S. District Court for the Southern District of Texas, seeks permanent injunctions, disgorgement, prejudgment interest, and civil penalties against each defendant, as well as a penny stock bar against Hrvatin. Criminal charges against all eight individuals also were filed in a parallel action brought by the Department of Justice’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas.

The SEC’s investigation, which is ongoing, is being handled by Andrew Palid, David Scheffler, and Michele T. Perillo of the Market Abuse Unit (MAU) in the Boston Regional Office, with assistance from Darren Boerner of the MAU, Stuart Jackson, Kathryn Schumann-foster, and Marina Martynova of the Division of Risk and Economic Analysis (DERA) and Howard Kaplan of the Office of Investigative and Market Analytics. The investigation resulted from a referral from the Division of Examinations by Mark A. Gera, John Kachmor, Nitish Bahadur, and Raymond Tan in the Boston Regional Office. The litigation will be led by David D’Addio and Amy Burkart of the Boston Regional Office.

The SEC appreciates the assistance of the Criminal Fraud Section of the U.S. Department of Justice, the United States Attorney’s Office for the Southern District of Texas, the Federal Bureau of Investigation, and the Financial Industry Regulatory Authority.

The SEC’s Office of Investor Education and Advocacy has issued an Investor Alert on Social Media and Investment Fraud. Investors can find additional information, including the warning signs of fraud, at Investor.gov.

You may also like

logo-white

Your Trusted Source for Capital Markets & Related News

© 2023 LiveTradingNews.com – For The Traders, By The Traders – All Right Reserved.

The information contained on this website shall not be construed as (i) an offer to purchase or sell, or the solicitation of an offer to purchase or sell, any securities or services, (ii) investment, legal, business or tax advice or an offer to provide such advice, or (iii) a basis for making any investment decision. An offering may only be made upon a qualified investor’s receipt not via this website of formal materials from the Knightsbridge an offering memorandum and subscription documentation (“offering materials”). In the case of any inconsistency between the information on this website and any such offering materials, the offering materials shall control. Securities shall not be offered or sold in any jurisdiction in which such offer or sale would be unlawful unless the requirements of the applicable laws of such jurisdiction have been satisfied. Any decision to invest in securities must be based solely upon the information set forth in the applicable offering materials, which should be read carefully by qualified investors prior to investing. An investment with Knightsbridge is not suitable or desirable for all investors; investors may lose all or a portion of the capital invested. Investors may be required to bear the financial risks of an investment for an indefinite period of time. Qualified investors are urged to consult with their own legal, financial and tax advisors before making any investment. Knightsbridge is a private investment firm that offers investment services to Qualified Investors, Members and Institutions ONLY. Qualified Investors are defined as individuals who have met those Qualifications in the relevant jurisdictions. Members are defined as individuals who have been accepted into the Knightsbridge membership program. Institutions are defined as entities such as banks, pension funds, and hedge funds. If you are not a Qualified Investor, Member or Institution, you are not eligible to invest with Knightsbridge. All investments involve risk, and there is no guarantee of profit. You may lose some or all of your investment. Past performance is not indicative of future results. Knightsbridge is not a registered investment advisor, and this disclaimer should not be construed as investment advice. Please consult with a qualified financial advisor before making any investment decisions. By accessing this website, you agree to the terms of this disclaimer. Thank you for your interest in Knightsbridge.