- Keith Gill, aka RoaringKitty, was hit with a securities-fraud lawsuit over his role in the GameStop short squeeze.
- Gill developed a following as he documented his “YOLO” bet on Reddit’s Wall Street Bets forum.
- He was named in a proposed class-action lawsuit filed in Massachusetts, Bloomberg reported.
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Gill gained a following as he documented his “YOLO” trade in GameStop on Reddit’s Wall Street Bets forum for more than a year. He invested $US53,000 ($68,439) in GameStop stock and call options in June 2019. The value of those securities peaked at about $US48 ($62) million during GameStop’s epic short squeeze last month.
Gill was named in a proposed class-action lawsuit filed in Massachusetts on Tuesday alleging that he misrepresented himself as an amateur investor when in reality he was a licensed securities professional, Bloomberg reported. The suit also alleged that Gill profited from GameStop’s rise by artificially inflating the price of the stock.
“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 lawsuit said, according to Bloomberg.
It continued: “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.”
GameStop has lost more than $US20 ($26) billion in market value since its stock topped out at $US483 ($624) on January 28. But investors who bought shares of GameStop weren’t the only ones to lose money – short-sellers who were betting against GameStop lost more than $US1 ($1) billion.
Gill and the CEOs of Robinhood, Reddit, Melvin Capital, and Citadel are set to testify before Congress on Thursday about the GameStop saga.