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Federal attorneys are investigating meme-led buying and selling in GME, AMC and silver: WSJ

02/11/2021

The Justice Division joins CFTC and SEC probes into wild markets facilitated by Robinhood and different apps for retail merchants.

The Division of Justice is reportedly the newest to show up the warmth on final month’s crazed markets.

Citing unnamed sources, the Wall Avenue Journal reported on Thursday that the DoJ’s fraud division and the San Francisco district lawyer’s workplace had launched probes into the brokers (learn: Robinhood) and social-media platforms (learn: Reddit) who had been on the middle of untamed bull markets on shares like GameStop and AMC weeks in the past. 

Quite a lot of businesses have introduced that they’re wanting into market manipulation considerations. The Securities and Alternate Fee launched a cryptic assertion to that impact as GME shares had been nonetheless convulsing, whereas simply this morning the SEC shut down all buying and selling in SpectraScience inventory, a agency that had turn out to be the topic to meme-fied buying and selling regardless of being functionally lifeless for a number of years.

The WSJ additionally studies that the Commodity Futures Buying and selling Fee has begun an analogous probe into the silver market, which spiked as buying and selling on varied shares was shut down and web curiosity dispersed.

In contrast to the CFTC or the SEC, nonetheless, the DoJ handles felony prosecutions, which carry the prospect of jail time. 

Congress is likewise getting concerned within the matter, with the CEOs of Robinhood, funding supervisor Melvin Capital and hedge fund Citadel reportedly getting ready to testify earlier than a Home listening to scheduled for subsequent Thursday.