A U.S. day trader has been charged with securities fraud for allegedly using his Twitter account to carry out a series of pump-and-dump schemes.
U.S. authorities charged Steven Gallagher, a 50-year-old Ohio-based trader, with securities fraud, wire fraud and market manipulation. The allegations have not been proven, and he is presumed innocent.
According to the U.S. Department of Justice (DoJ), Gallagher duped retail investors using a Twitter account under the alias “Alex DeLarge” — the same name as the anti-hero in the Anthony Burgess novel, A Clockwork Orange — which touted over-the-counter penny stocks, driving up their prices and enabling him to sell into the inflated values.
To boost stock prices, Gallagher used his account to make “materially false and misleading statements” about the securities, the DoJ alleged, including claims that he was buying or holding stocks when he was actually selling.
“As alleged, Steven Gallagher brought old-school boiler room tactics to the Twitter age, and operated a social media pump-and-dump scam that defrauded ordinary investors,” said Damian Williams, U.S. attorney for the Southern District of New York.
The DoJ alleged that Gallagher made over US$1 million in illegal trading profits with the schemes.