E*Trade Considers Banning “Roaring Kitty” Over GameStop Stock Manipulation Concerns
E*Trade, the popular online trading platform, is currently mulling over the decision to ban Keith Gill, also known as “Roaring Kitty,” from its platform due to concerns of stock manipulation related to GameStop (GME).
Gill, who is widely credited as the central figure in the 2021 meme stock rally and the GameStop short squeeze, made significant purchases of GME options on E*Trade before his unexpected resurgence last month, which led to a surge in GameStop shares.
A recent report from The Wall Street Journal on June 3 revealed that some of these options expired the same week, potentially resulting in profits for Gill.
The owner of E*Trade, Morgan Stanley, along with the firm itself, are cautious that Gill’s influence could be utilized to artificially inflate GME’s stock price for personal gain. They are currently evaluating whether his recent posts on platforms like X and Reddit could be construed as manipulative.
The firm is also weighing the potential backlash that could arise from removing Gill, as other users may choose to close their E*Trade accounts in solidarity. At this point, no final decision has been reached, and E*Trade may ultimately opt to take no action.
Gill made a comeback on X on May 13 after a three-year hiatus, posting cryptic messages that boosted meme stocks and memecoins. On June 2, he returned to Reddit for the first time since 2021, revealing that he held $181.4 million worth of GME stock and call options, betting on GME reaching at least $20 per share by June 21. This post caused GME shares to surge by over 19% during Sunday night trading.
Continuing his Reddit posts on June 3, Gill shared that he had gained $33.6 million on his 5 million GME shares and $51.8 million on his options.
With several securities-industry licenses under his belt, Gill was previously a registered broker with Massachusetts Mutual Life Insurance. The Massachusetts Securities Division is currently investigating his activities.
Sources from The Wall Street Journal also disclosed that the Securities and Exchange Commission (SEC) is reviewing GameStop call options trades around the time of Gill’s X posts. The SEC is internally deliberating whether these trades could be deemed manipulative, although it remains uncertain if Gill is specifically under investigation.
As regulatory inquiries continue, E*Trade’s contemplation of banning Gill from the platform raises significant concerns regarding market integrity. Stay tuned for further updates on this developing story.
In other news, Australian rapper Iggy Azalea has announced her intention to burn her Mother Iggy (MOTHER) tokens whenever a celebrity project is identified as a scam.
