Busted: Atlas Trading Pump & Dump Scheme
The SEC charged seven influencers and a podcaster in the $114 million Atlas Trading pump-and-dump scheme.
According to the SEC, the seven individuals below promoted themselves as successful traders:
Perry “PJ” Matlock Texas Twitter: @PJ_Matlock / Discord: PJ Matlock#0001
Edward Constantin Texas Twitter: @MrZackMorris / Discord: Zack Morris#0001
Thomas Cooperman California Twitter: @ohheytommy / Discord: TOMMY COOPS #5323
Gary Deel California Twitter: @notoriousalerts / Discord: Mystic Mac [Clover emoji] #7345
Mitchell Hennessey New Jersey Twitter: @Hugh_Henne / Discord: HOODHUGHBEAR [Bear emoji] #4034
Stefan Hrvatin Florida Twitter: @LadeBackk / Discord: Lade Backk#6083
John Rybarczyk Texas Twitter: @Ultra_Calls / Discord: Ultra#0374
“As our complaint states, the defendants used social media to amass a large following of novice investors and then took advantage of their followers by repeatedly feeding them a steady diet of misinformation, which resulted in fraudulent profits of approximately $100 million.” ~Joseph Sansone, Chief of the SEC Enforcement Division’s Market Abuse Unit
— 💰Retro1UP 💎🚀 (@Retro1upArmy) December 15, 2022
Collectively, they amassed over 1.5 million followers on Twitter. On Discord, they ran a community called Atlas Trading, which had a chatroom. They promoted it as one of the largest, free online communities in the world for individual stock traders.
Since at least January 2020, these folks have been engaged in a social media pump-and-dump scheme whereby they purchased certain stocks, then used Twitter and Discord to post “false and misleading information” in order to encourage others to buy into those stocks, which pumped up the stock prices, authorities allege.
While these influencers were pushing the idea that they were buying, holding, or adding to their stock positions, according to the authorities, they were dumping their shares.
By selling the shares at artificially inflated prices that they created, the feds claim these people made “at least” about $114 million in profit.
— 🌐StimulusPkg🌐 (@StimulusPKG822) December 14, 2022
The eighth person accused is Daniel Knight (Twitter Handle: @DipDeity, Discord Handle: Dan, Deity of Dips#8114), of Texas. One of his roles in the scheme was co-hosting a podcast where he promoted some of these influencers as expert traders, authorities allege.
He provided them with a forum for their manipulative statements, and he traded stocks to profit from the manipulation, the feds say.
— Monty Crux Jr (@DaddyFailure) December 15, 2022
All of the defendants are charged with one count of conspiracy to commit securities fraud plus…
Knight is charged with aiding and abetting.
Constantin is charged with three counts of securities fraud and one count of engaging in monetary transactions in property derived from specified unlawful activity.
Matlock and Deel are both charged with five counts of securities fraud while Rybarczyk got hit with four counts of that charge. Hrvatin, Cooperman and Hennessey face two counts of securities fraud.
They made their first appearance in federal court on December 13.
What are they facing?
If convicted, each of these folks faces a maximum penalty of 25 years in prison for conspiracy to commit securities fraud and each charged count of securities fraud.
Constantin also faces a maximum penalty of 10 years in prison if convicted of engaging in unlawful monetary transactions.
Furthermore, the feds are seeking permanent injunctions, disgorgement, prejudgment interest, and civil penalties against each defendant, as well as a penny stock bar against Hrvatin.
The investigation of this Atlas Trading pump-and-dump scheme is still ongoing.
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