As smart as they are known to be, human beings just cannot keep themselves away from making mistakes. This dynamic has already been reinforced quite a few times throughout our history, with each testimony practically forcing us to look for a defensive cover. We will, however, solve our conundrum in the most fitting way possible, and we’ll do so by bringing dedicated regulatory bodies into the fold. Having a well-defined authority across each and every area was a game-changer, as it instantly concealed our many shortcomings. Now, the kind of utopia you would generally from such a development did arrive, but at the same time, it failed to stick around long. Talk about what caused it to dissipate so soon, the answer will touch upon technology before it covers anything else. You see, the moment technology got its layered nature to take over the scene, it allowed every individual with an unprecedented chance to exploit others for their own benefit. In case this somehow didn’t sound bad enough, the whole runner soon began to materialize on such a massive scale that it expectantly overwhelmed our governing forces and sent them back to the drawing board. After a lengthy spell in the wilderness, though, it seems like the regulatory contingent is finally ready for a meaningful comeback. The same has turned more and more evident in recent times, and truth be told, DoJ’s decision against a new Discord-centric fraud will only solidify its traces moving forward.
The US Department of Justice has officially charged eight online finance influencers with criminal securities fraud in relation to what is believed to be a multi-million dollar pump-and-dump scheme. Going by the available details related to the case, these influencers, who were part of a Discord forum called Atlas Trading, used that channel and their huge Twitter following to promote stocks that they had bought in large quantities. By making false statements about the stocks’ value and their intention to hold on to it, the defendants convinced the masses to buy in, and that unsurprisingly drove up the stock’s price well beyond its intrinsic value, thus allowing the stated influencers to exit their position at a massive profit. If we are to trust the figures mentioned in several official documents, this whole scheme fetched them a whopping profit of around $114 million.
Beyond DoJ, the Securities and Exchange Commission also filed a separate, albeit identical, complaint against the perpetrators, with both indictments charging seven of the men directly with securities fraud, while one member is charged with aiding the conspiracy through a finance podcast. Talk about which stocks were actually manipulated to pull of the scheme, they included China SXT Pharmaceuticals, Torchlight Energy Resources, GTT Communications, Surface Oncology, Alzamend Neuro, Universe Pharmaceuticals, ABVC BioPharma, DatChat, and Brickell Biotech.
As for their punishment, seven influencers face conspiracy and fraud charges that are understood to carry a maximum sentence of 25 years in prison for each count. The one influencer who chipped in through his podcast, though, is looking at a 10-year prison time. Hold on, there is more. With SEC involved, we could also see some financial penalties, including complete surrender of all the ill-gotten profits.