HOUSTON — Eight social media influencers, four from the Houston area, have been accused of using their social media presence to commit securities fraud in a "pump and dump" scheme.
According to court documents, the eight individuals, who collectively had over 1.5 million followers, used their social media presence on Twitter and Discord to hype their followers' interest in particular securities by posting false and misleading information in order to “pump” the prices of those securities, while concealing their plan to later “dump” their shares by selling them at the artificially inflated prices.
In addition to what they were doing on social media, the individuals are also accused of running an online community for individual stock traders called Atlas Trading which they promoted as one of the largest, free online communities in the world for individual stock traders. Atlas Trading had a chatroom called Atlas Trading Discord where they would spread false and misleading information about securities for their financial gain.
The U.S. Department of Justice said from around January 2022 to around April 2022, the individuals made about $114 million from their scheme.
All eight of the defendants are charged with one count to commit securities fraud. Some of the individuals have additional charges. See below.
- Edward Constantinescu (@MrZackMorris), Montgomery, Texas -- also charged with three counts of securities fraud and one count of engaging in monetary transactions in property derived from specified unlawful activity
- Perry Matlock (@PJ_Matlock), The Woodlands -- also charged with five counts of securities fraud
- John Rybarczyk (@Ultra_Calls), Spring, Texas -- also charged with four counts of securities fraud
- Gary Deel (@notoriousalerts), Beverly Hills, California -- also charged with five counts of securities fraud
- Stefan Hrvatin (@LadeBackk), Miami, Florida -- also charged with two counts of securities fraud
- Tom Cooperman (@ohheytommy), Beverly Hills, California -- also charged with two counts of securities fraud
- Mitchell Hennessey (@Hugh_Henne), Hoboken, New Jersey -- also charged with two counts of securities fraud
- Daniel Knight (@DipDeity), Houston, Texas
If convicted, each individual 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.
If you believe you are a victim in this case, please contact the Fraud Section’s Victim Witness Unit toll-free at (888) 549-3945 or by email at victimassistance.fraud@usdoj.gov.
The FBI Houston Field Office is investigating the case.
