Rise in Gamestop Stock Value Could Draw Attention from Federal Regulators

The Wall Street Journal reports skyrocketing Gamestop (NYSE: GME) value prompted halts on the New York Stock Exchange after Reddit users heavily promoted its shares on the social media platform this week. Events like this have drawn attention from federal regulators in the past, while proposed SEC chairmen, Gary Gensler, formerly of the CFTC, promises increased scrutiny under the Biden administration.

New investors may be affected by firms who induced them to invest under fraudulent pretenses, such as pump and dump schemes, which have been unusually prevalent on the COVID-19 pandemic’s tumultuous market. Anti-trust concerns may also be raised if a group of investors posted to the social media forum with the intention of manipulating the market.

On the other hand, brokers and investment firms involved in such trades may face additional scrutiny by the SEC. These individuals will require professional and experienced legal counsel in such investigations, even if they acted under full compliance with existing regulations. Free speech concerns may be raised by compliant investment firms since regulatory authority does not extend to decisions made freely by investors that result in loss.

If you have been affected by issues surrounding such trading activity, call Christopher Warren at the Warren Law Group at (866) 954-7687 or email info@warren.law. We will provide free consultation and help determine the basis of legal actions necessary in your case.



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