Eight people connected to Atlas Trading, a Discord-based community, have been named in a complaint filed by the Securities and Exchange Commission (SEC).
Co-founders of the forum, podcasters, and YouTubers are accused of stock manipulation.
The lawsuit was submitted to the U.S. District Court for the Southern District of Texas on Dec. 13.
The defendants are charged with breaking both Section 10(b) of the Securities Exchange Act and Section 17(a) of the Securities Act, according to the regulator.
In the filing, the SEC says the accused individuals took significant positions in certain securities, advocated those stocks to their followers, and then sold their shares when demand increased as a result of their "deceptive promotions." The regulator alleges that the bloggers made profits of at least $100 million.
Alzamend Neuro Inc ALZN, Torchlight Energy Resources, and ABVC Biopharma Inc ABVC were listed as examples of those alleged stock promotions.
Also read: Bahamian Securities Regulator Warns FTX CEO John Ray Not To 'Obstruct' Probe, As He Gives Testimony
List Of Defendants
On the list of defendants is Atlas Trading co-founder Edward Constantin aka MrZackMorris; Perry Matlock, the "CEO" of the same forum; Pennies: Going in Raw podcast hosts Mitchell Hennessey and Daniel Knight; Thomas Cooperman and Gary Deel, the creators of the YouTube channel Goblin Gang; John Rybarcyzk, the creator of the Sapphire Trading forum; and Twitter influencer Stefan Hrvatin aka LadeBackk.
The lawsuit classifies Constantin, Matlock, Cooperman, Deel, Hennessey, Hrvatin, and Rybarcyzk as "primary defendants," while Knight is accused of "aiding and abetting" those individuals.
The Commission is asking for a court order that would prevent defense attorneys from engaging in any of the actions listed in the complaint, which could essentially include giving stock trading advice.
Next: 'Worst Mess Ever Seen,' John Ray Says Of FTX; Congressman Says He Wants Sam Bankman-Fried's 'Lies On Record'
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