One of the very best things about the rise of social media has been the proliferation of new, honest and dependable voices in securities analysis. Truly there has been no better way for the man on the street to learn how to invest intelligently and prudently than by listening to the sage advice proffered—for free, no less!—on such platforms as Facebook, YouTube and Reddit. And perhaps nowhere has this been more true than on the not-at-all-a-bullying-intellectual-sewer of Twitter, where the truth is distilled into succinct 280-character nuggets.
Imagine our surprise and horror to learn, then, that a person has been abusing that safe space to take advantage of others for his own benefit! Who could possibly imagine a thing? I mean, if this were true, it’s almost as if someone could lie their way all the way to the White House using such technology! And worst of all, his name isn’t even Alex Delarge!
Steven Gallagher, 50, was taken into custody in Ohio Tuesday for running a pump-and-dump scheme that netted him more than $1 million through the Twitter handle, @AlexDelarge6553, according to a criminal complaint filed in federal court in Manhattan. Gallagher, who has touted at least 60 companies since the end of 2019, continued the manipulative conduct even after his brokerage firm closed his account, the Securities and Exchange Commission alleged in a parallel civil case…. In the SpectraScience trade, for example, Gallagher allegedly coordinated with other traders to buy shares in the defunct company, which hasn’t filed SEC financial statements since 2017. Gallagher acquired more than 20 million shares of the penny stock and touted it in a series of colorful tweets, showing purported screenshots of his brokerage orders, according to the criminal complaint filed by Manhattan federal prosecutors. He sold while continuing to promote the shares, writing: “Haven’t sold a share yet!”
Unbelievable. But it gets worse. For instance, would you believe that a New Jersey man promising 60% returns to clients might not be on the up-and-up? We couldn’t, and neither could those clients, apparently, but it’s (allegedly) true!
Swapnil Rege started a new company and raised $10 million from investors after he was fired from Marinus in 2017 and even after he agreed to an industry ban to resolve 2019 charges that he artificially inflated his positions on derivatives to earn himself a higher bonus at the fund…. The Securities and Exchange Commission said Rege, 46, promised investors in his company, SwapStar Capital LLC, returns of up to 60% but used most of the money to pay back other clients and for personal expenses, including the legal fees he incurred during the earlier government probe…./ In its suit Tuesday, the SEC said several clients had said they had no idea Rege had been barred from the industry and wouldn’t have invested with him if they knew.
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