Being Sued for $110 Million Dollars by the SEC.

multiple social media influencers were

just charged by the SEC

for allegedly defrauding people of over

110 million dollars in this video I'm

going to break down some of the

allegations against these finfluencers

and you'll see kind of the shenanigans

that were happening both behind the

scenes and in the faces of individuals

now full disclaimer I'm a finance

YouTuber I'm an influencer and I'm on

YouTube that also makes me a finfluencer

which is really disgusting to have any

kind of association with that because I

don't even know these people what I do

know though is that I am a licensed

financial advisor I operate an active

ETF I'm a real estate broker I used to

be a licensed lender a licensed

contractor and I have a real estate

startup that has raised a nearly 30

million dollars and we've got a reggae

offering coming soon the point of me

saying that is I'm under the scrutiny of

a lot of different regulatory

organizations and my goal is not to

provide you personalized Financial

Insight in this video it's just to say

that I'm doing my best to try to make

sure that everything I'm doing is above

board with the SEC and the law and that

is what everybody should should strive

to do personally I think in the future

anyone making Financial YouTube videos

will probably have to be licensed I just

happen to already have that checked off

in the meantime let's hop into the

complaint because it's fascinating so

here you can see this is the Security

and Exchange Commission in a complaint a

complaint is a fancy name for a lawsuit

filed today you can see that some of the

creators involved here are names like Mr

Zach Morris whose name is neither Zach

nor Morris uh we've got PJ Matlock Tommy

coops Mystic Mac Hugh hiney hinny

whatever

lad back laid back laid back yeah deity

of dips and Ultra calls as well as the

stocks stock sniper boy okay so let's

look at the allegations and then get

into some specific scenarios I've

already done the hard work for us for

years these individuals have promoted

themselves as stock picking gurus in

reality these individuals and this is

all an allegation by the SEC against

these individuals I want to make that

clear I imagine they have some form of

defenses but the stuff in here is pretty

damning but then again that's what

lawsuits look like the party that files

a lawsuit it's like oh damn that looks

intense and anyway we'll let you make

your own determination and clearly the

court of law but in reality the SEC says

these individuals are seasoned stock

manipulators they identify stocks ripe

for manipulation which just so you know

are usually small capitalization stocks

when a company is less than one billion

dollars in market cap it could easily be

manipulated by influencers on the

internet be careful about stocks under 1

billion dollars of assets under

management and if you are not assets

under management of market

capitalization if you're under 250

million dollars it gets even worse

so they would identify stocks right for

manipulation acquire substantial

positions in these stocks and then

recommend those stocks as good

Investments to their followers in

Twitter in online stock trading forums

they run and on podcasts they encourage

their followers to purchase the selected

stocks often claiming that they likewise

have bought or intend to buy these

stocks themselves and hold them however

instead the defendants then sell their

shares into the demand that their

deceptive promotions generate and this

apparently has occurred between January

2020 and now and eight defendants earned

approximately 100 million dollars from

the stock manipulation scheme and the

SEC is looking for all of that money

back plus

civil penalties whoo boy this is intense

so let's go ahead and get past how many

followers they had all between somewhere

between 100 000 and 500 000 followers so

let's take a look at the summary of the

scheme the summary suggests that these

individuals would often publish false

and misleading information this can be

something like oh the CEO said this we

think this is going to happen oh we

think the stock is going to Rally in

after hours where liquidity is really

thin so you take a small thinly traded

stock and then you go into after hours

where there's even less liquidity

ripe for disaster these are red flags to

be aware of if you are an investor small

caps and after hours dangerous words

and then these individuals would

essentially pump the value of these

stocks up which could be something like

saying hey I think ticker symbol XYZ is

going to go to the moon in after hours

you look at it it's a 50 million dollar

market cap in after hours there's even

less liquidity so the order book gets

eaten up and the stock can move very

very quickly with few trades it's

important to understand how order books

work in the stock market think about it

in a very simplistic view if there are

only if there's only one person willing

to sell shares in the after hours of

ticker XYZ that's selling for ten

dollars and that person's willing to

sell two shares at ten dollars and a

hundred shares at 15 and somebody comes

in and says Market order good to cancel

good for after hours with a high limit

of twenty dollars or whatever and

somebody comes in and says I want to buy

105 shares the order book is going to

deploy uh purchases at ten dollars and

then absorb all of those 100 shares at

fifteen dollars and it will will look

like that stock moved 50 percent

just like that because of a thinly

traded order book now generally during

Market hours on largely traded stocks

the order book is much thicker and it

could take billions of dollars to make

any kind of actual substantial moves on

very heavily traded large caps or even

index funds for example you generally

don't move those sorts of stocks that's

why the smaller ones are so susceptible

to this anyway the defendants then

provided each other an opportunity to

buy these thinly traded stocks they all

got in prior to the manipulation then

they would promote the stocks generating

demand for the stocks to inflate the

share prices and then they would dump on

their followers even lying to their

followers about why certain stocks

declined while it was actually them

causing the declines by dumping their

shares on their followers they would

also lie to people about losing money on

stocks when they had actually profited

handsomely they say here indeed in

private chats and Surah petitiously

recorded secretly recorded conversations

they bragged and laughed about making

profits at the expense of their

followers this is so dirty like this is

the kind of stuff that deserves to be

prosecuted to the full extent of the law

the defendants each included disclaimers

on their Twitter accounts that they were

not providing stock recommendations or

financial advice yeah providing a

disclaimer provides you no absolutely no

exemption from breaking the law you

can't disclaim one thing but then break

the law that does you no good in fact if

you look for example at my Twitter I

don't even have a disclaimer on there

because I know everything I do any

action I do will stand on its own and

every action I take individually will be

determined as either breaking the law or

not and of course my goal and my belief

is that I'm always making sure I'm well

in compliance with the law my goal is to

continue to be in compliance with the

law and and this is why for example when

I say hey I'm going to provide

potentially Financial advice but it's

non-personal and it's for free here on

YouTube that's a very important

clarification that I am a licensed

financial advisor and I could say hey I

think investing in real estate is a very

sound financial decision for most people

it might not be right for you but again

people use this as a cop-out and then

they pump stocks and illegally lie to

people that's when you get in trouble

when you lie oh boy the SEC is coming

for you if you say you're selling a

stock you better be selling a stock if

you say you're holding a stock you

better be holding that stock otherwise

they are coming for you as they should

because otherwise you're manipulating

the market that's just wrong so they

would tweet things like let's all get

rich Let's Escape the nine to five let's

get to Financial Freedom let's get Fu

money oh hope everybody banked on our

trades and here are some of the things

that they would do to try to tweet out

their lifestyle oh driving around in

Lambos and glambos and fancy lifestyle

whatever and they would portray these

images while at the same time lying to

their audience and this is where take a

listen to this

while they would portray

misleading trading methods accessible to

anyone to potentially build significant

wealth the defendants repeatedly shared

a sold shares in direct contradiction to

their public statements to their

followers on social media this is a

practice known as pumping the pump and

dump and the SEC gives some wonderful

examples here for example on March 1st

there were conversations where they

talked about manipulating a certain

ticker gtt and they talked literally in

chats about saying things like this were

robbing effing idiots of their money and

they're talking about getting caught

they know what they're doing is wrong

behind the scenes but not only were

there conversations like this alleged in

the complaint but they would say things

like this

abvc strange action today bag holder

here with the little wavy hand

suggesting that this person is a bag

holder honestly doesn't make sense

events ran from 3 30 to 4 40 yesterday

and to 420s today but faded due to

shorts and scalpers how dare the shorts

sound that's always it's always somebody

else manipulating the stock raw I'm sure

they made money but I hold my word and I

don't dump on anyone and then what does

the SEC say right after that here the

individual claims he lost money and that

he was a bag holder and that others

caused the share price to drop and that

he would not dump shares on anyone but

what did the individual actually do the

individual actually made a profit of

nearly 69 thousand dollars the day he

posted that tweet by dumping his shares

while recommending the stock to his

followers saying he was essentially a

diamond handing bag holder and with them

while lying to their faces so disgusting

so disingenuous it's so wrong you know

when I sold my stock portfolio in

January of 2020 and uh 2022 and I told

everybody about it I got a lot of hate

for selling because people were like

wait Kevin we thought we were holding

I'm like this is why I'm transparent is

because in the short term people might

be mad at you but you have to be honest

with people you cannot lie to people you

must must must be honest to people even

if it's hard news it's better to give

hard news and be honest than to lie but

these people weren't about to give hard

news because they knew exactly what they

were doing because they were scammers

these are true definitions of fraud

assuming what the SEC here is alleging

is true and it looks pretty damning

here's another one

arec stopped me guys sorry about this

one I lost 20K here looks like 1.5

million shares were sold over five sorry

to anyone who took uh who took with me

who took losses with me right had great

news this morning but didn't want to go

I'll look for us I'll look for a better

one for us so talks about losing 20 000

actually made more than seven thousand

dollars dumping the stock that day and

over six thousand dollars selling his

shares the day before that

yikes but it's not just examples like

this there are more examples like on CEI

stock another thinly traded retail stock

in the past I've warned about falling

momentum and when you get into these

thinly traded stocks they usually only

run for as long as there's momentum and

hype around them and now we come to find

out that it's because there are people

who are pumping these stocks just to

dump them it's a fraud within the next

four minutes after posting adding CEI

with you that's cheap within the next

four minutes Matt sold 165

000 shares the other another individual

deal sold 60 000 shares cooperman sold

240 000 shares as the price Rose by a

penny per share all of them then posted

about CEI again CEI with the CEO saying

no reverse split they have to think it

will get to a dollar I feel good with

swinging this one for a week for a

run-up no reverse split on CEI adding

CEI here for a swing last time it

touched these levels on The Daily we saw

a move of three plus lots this is

basically saying hey look if they're not

going to do a reverse split the company

must be really excited about the future

potential so let's Diamond hand this

thing meanwhile they've already dumped

so disgusting or actually they had

already dumped but then the SEC alleges

immediately after these posts they began

selling more shares within two minutes

one had sold 95 000 shares another 198

000 another one selling all remaining

165 000 shares this is literally fraud

I mean it's

on Twitter on your phone posting a tweet

putting it down and then going over

hitting the sell button it's so

disgusting because it's the opposite

it's one thing it's totally one thing if

you're like okay I'm in my Weeble I'm

gonna sell Tesla you sell all your Tesla

and then you tweet out yo I just sold

all Tesla I'm freaked out about Elon

Musk right that's one thing you're being

honest

this is the complete opposite it's

fraudulent so disgusting

so while deal a deal was promoting CEI

on Twitter he was simultaneously selling

his shares liquidating 60 000 shares

Matlock again over and over again wasn't

just here look at this CEI let's squeeze

what did they do continued to sell

shares to Their audience despite telling

his followers he was holding shares and

intended to add to the position in after

hours deal immediately began selling

this is just straight fraud these folks

deserve to be next to Sam bankman freed

with how disgusting this is either way I

think this stock will eventually get

back to one dollars but I'll gracefully

make my exit around one dollar when did

they exit around 50 cents almost

immediately after scumbag I added more C

I swing this morning over the next two

minutes what happened

sold Liars Liars Liars nose grows long

despite telling his followers he would

be adding all day to a swing deal soon

began selling his entire position I read

this whole thing okay I'm just giving

you the highlights here too many of you

act like little when there's a

dip it's all part of the game and then

right after that tweet what happened

marcelling I ain't selling under a three

bleeded uh delete that believe that

probably right and then what happened

despite telling his followers that he

was holding overnight because a huge day

is coming already began to dump shares

CEI gets ready for the next leg up we're

aiming for four dollars today oh he

waited a whole five minutes this time

then sold all his shares see I short

screwed see you at ten dollars while I

dump now scumbags

this is disgusting

these messages also contain specific

price targets claiming that they were

holding on to a stock because we're

about to hit a new high however in

contrast to their claims they were that

they were holding a l z and stocks and

even adding to their position they were

selling all or most of their stock below

the price targets the same was true of v

i s l and within minutes all of them

sold sold sold sold sold of telling

their participants that they were

amassing part shares look at this one v

i s l yon wake me up at ten dollars and

then in a chat room hey guys I think my

tweet worked I think my tweet definitely

helped it out right here and then

immediately began selling shares for a

19 Cent gain per share on a penny stock

keep in mind any stock under five

dollars is considered a penny stock

even though generally we think of a

penny stock we think a dollar or less

technically a stock under five dollars

is a penny stock Knight tweeted all hail

v i s l and the piss missile and then

went right back to selling these people

are just straight up D-backs I smell an

after hours gapper after hours gapper is

kind of like what I described with the

order book where all of a sudden you get

like a big gap up because somebody ate

up the order book I smell an after hours

gapper implying that people might make

big money in the after hours thinly

traded and then start a dump dump dump

dump

I mean this this goes on to torch trch

another meme stock uh that that momentum

torch I smacked 50k on this news she's

going to all-time highs immediately

after the Tweet sold 30 000 shares I

mean this is so in-depth abvc biopharma

we got you there too over and over and

over again and the SEC is pissed and

they're looking for a trial to bring

these people to Justice honestly

good job SCC this is impressive they put

together a in case here and if all

that stuff is true

jail that dessert deserves jail people

need to be made an example of you have

to be honest with people as hard as it

is you know especially in like bear

markets and recessions people like

stunks go down that's what happens right

like times are tough times are painful

just don't lie to people disgusting

absolutely disgusting manipulation and

I'm so proud of the SEC for this and

this is the kind of organization that I

want to make sure I respect to the to

the end because all Financial YouTubers

should look at the SEC and go and send

thank you letters and say thank you

forgetting the trash and the people who

sink the reputation of influencers out

of the industry they gotta go

disgusting

thank you so much for watching folks

we'll see in the next one