January 29, 2023

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Eight men, including 1/2 from Breathe Carolina, charged in securities fraud schemes

In a US Department of Justice news release issued yesterday, eight men have been charged in a $114 million securities fraud orchestrated via social media, including Tom Cooperman, one half of the duo Breathe Carolina.

According to the publication, “A federal grand jury in the Southern District of Texas returned an indictment that was unsealed yesterday charging eight men with conspiracy to commit securities fraud for a long-running social media-based ‘pump-and-dump’ scheme .”

It goes on to say: “According to court documents [these men] allegedly involved in a wide-ranging securities fraud conspiracy, in which the defendants used their extensive social media presence on Twitter and Discord to generate interest in certain securities by posting false and misleading information in order to “exploit” the prices of those securities. pump” while hiding their intention to later sell their shares at artificially inflated prices. From about January 2020 to about April 2022, the defendants benefited from their plan at least about $114 million.”

“Financial crimes like securities fraud may not be violent, but they certainly aren’t victimless,” said Special Agent in Charge James Smith. “The eight people arrested today are accused of costing investors, particularly their trusted social media followers, millions of dollars through a ‘pump and dump’ market manipulation scheme they allegedly ran on popular social media sites. platforms have carried out. As the leading agency investigating corporate fraud, the FBI was able to uncover their alleged manipulative activities and uncover their coordinated pattern of securities fraud.”

The men used their apparent expertise in stocks and trading to allegedly manipulate their followers into buying stocks they were said to be interested in, dumping their own shares as the price rose thanks to inflation.

All of the defendants are charged with conspiracy to commit securities fraud. Cooperman faces two counts of securities fraud in particular. You can read the full indictment here.