June 4, 2024 – 8:15 AM PDT
NEW YORK (Reuters) – The Massachusetts securities regulator is probing the trading activities of GameStop (GME.N) investor Keith Gill, who gained notoriety as stocks influencer “Roaring Kitty” during the 2021 meme stock frenzy.
Massachusetts Secretary of State Bill Galvin, the state’s top securities regulator, is looking into Gill’s activities, a spokesperson said, declining to comment further.
The Wall Street Journal first reported the inquiry.
GameStop shares surged on Monday after the stocks influencer “Roaring Kitty” returned to Reddit with a post showing a $116 million bet on the embattled videogame retailer.
Shares were down about 5% by 10:45 a.m. ET (1445 GMT).
The post, the first from the account in three years, also indicated that Gill may be sitting on a paper profit of tens of millions of dollars on his position in GameStop options.
Reuters was unable to independently verify if the Reddit post was made by Gill or if the positions disclosed were authentic.
Gill could not be reached immediately for comment. Regulatory inquiries and probes do not necessarily indicate wrongdoing and frequently do not result in any enforcement action.
Galvin had probed Gill’s 2021 activities but closed that matter after bringing a settlement with Gill’s former employer MassMutual for failing to properly supervise his activities, the spokesperson told Reuters last month.
In 2021, screenshots on Reddit of his bullish GameStop trades triggered a rush of demand for “meme stocks” – often companies with weak fundamentals that gained a cult-like following through social media hype among retail traders.
The U.S. Securities and Exchange Commission investigated the meme stock craze of 2021, ultimately finding that marketplace systems worked well and failing to find evidence that short sellers were behind the frenzy as retail investors had alleged.
The WSJ also reported that the SEC is looking at options trading in GameStop. A spokesperson for the agency declined to confirm or comment.
Reporting by Chris Prentice; additional reporting by Nate Raymond; editing by Michelle Price and Marguerita Choy