MassMutual subsidiary MML Investors Services will fine the state of Massachusetts $ 4 million Social media posting became a central point in the GameStop saga. Gill is known for his Reddit moniker “DeepF —— Value” and “Roaring Kitty” on YouTube.
The consent orders were signed this week, with Galvin saying MassMutual has agreed to undergo an “independent compliance review” of its social media policies and trading practices for broker / dealer agents, and will also undergo a three-year compliance audit. According to Galvin, the company’s poor social media oversight has consistently failed to recognize Gill’s identity.
“It is clear that MassMutual has not been as careful in monitoring its employees as it should have been,” Galvin said in a statement. “It took the media less than a day to identify the person behind the Roaring Kitty posts while his own employer failed to notice his online personality.”
Under the Consent Order, Gill worked as an agent for MassMutual between April 2019 and January this year, posting hundreds of times on social media during that time. Starting around August 2019, Gill published “WallStreetBets” on the subreddit about GameStop and other securities and began posting videos and live streams about investing in GameStop securities on YouTube in July 2020.
“Although he never mentioned his name or affiliation with (MML Investors Services), Gill’s face was the focus of his YouTube videos,” read the order. “Gill posted at least 80 videos of more than 250 hours or more than 10 days of content, all of which he streamed live and posted while registered with (MML).”
Gill reportedly tweeted about the topic as well from July 2020 and eventually tweeted at least 590 times about GameStop until he was terminated by MassMutual in January 2021, a run on GameStop shares that led to wild price and market fluctuations. The GameStop frenzy, coupled with Short sellers taking drastic losses and brokerage apps The adoption of trading restrictions on certain stocks created a tumultuous period of market volatility, media attention, and control by Congress.
According to Galvin, MassMutual failed to supervise Gill and other broker / dealer agents in reviewing their social media use, even though Gill created “educational content” that MassMutual agents would use in conversations with customers and others. According to the order, at least one MML employee was aware of Gill’s GameStop postings last September, but it wasn’t until January 18, 2021 that another employee alerted the head of In Good Company (IGC), an operating company as (DBA) and marketing program, that Gill worked for in MML. (Gill was only fired on Jan. 28. During that time, he was ordered to make 19 additional security-related social media posts.)
In response to the controversy, Gill was charged in Massachusetts Federal Supreme Court, because he allegedly misrepresented himself as an “amateur investor” and artificially raised the price of GameStop shares, and his FINRA registration with MML was hired about a month after he stopped working there. In written certificate At a congressional hearing on the GameStop saga, Gill argued that while working for MML he never sold stocks or acted as an advisor, and never advocated GameStop investing for his own gain, citing the idea that he used social media to advertise the stock “absurd.”
“I was very clear that my channel was for educational purposes only and that my aggressive investment style probably wouldn’t be appropriate for most of the people who watch the channel,” he said. “Whether other individual investors bought the share did not play a role in my thesis – the focus was on the fundamental data of the company.”
Also, according to the investigation by Galvin’s Securities division, MassMutual failed to detect nearly 1,700 trades Gill made on three separate accounts held by individuals, including transactions nearly double the company’s limit of $ 250,000 per transaction. Additionally, he executed at least two GameStop trades totaling more than $ 700,000 without the knowledge of MassMutual, and Galvin, on a separate assignment, requested that MML register for 478 b / d agents and an administrative fine of $ 750,000 – Should pay dollars.
“MassMutual is pleased to move on from this matter and avoid the costs and distractions associated with lengthy litigation,” said a MassMutual spokesperson on Galvin’s order.
Last week, MML Investors Services settled with the Securities and Exchange Commission for alleged failure to disclose conflicts of interest in the allocation of income arising from recommendations of mutual fund share classes. An investigation into Gill’s Massachusetts registration is “pending,” according to Galvin’s office.