Twitter user 'Alex DeLarge' charged in pump-and-dump scheme
Prosecutors say the stock trader allegedly operated a social media scheme involving penny stocks that garnered $1 million in illicit profits.
On Tuesday, a stock trader named Steven Gallagher was arrested and charged in connection with his alleged role in a pump-and-dump scheme that involved promoting penny stocks on Twitter . As a Twitter user, Gallagher goes by the name "Alexander Delarge 655321," after Alexander DeLarge, the main character from the sci-fi film A Clockwork Orange, and a character's prison number in the film.
In a complaint in federal court, Gallagher was charged with securities fraud, wire fraud and market manipulation. The complaint alleges Gallagher used his Twitter account to hype penny stocks and spread misleading information about his trading in those stocks with the purpose of directing his Twitter followers to buy the stocks and drive up their prices.
The complaint further alleges that Gallagher earned more than $1 million by secretly selling those penny stocks, which he'd already bought. The announcement alleges Gallagher carried out the pump-and-dump scheme over and over to defraud individual retail investors.
"As alleged, Steven Gallagher brought old-school boiler room tactics to the Twitter age, and operated a social media pump-and-dump scam that defrauded ordinary investors, all so that he could make over $1 million in profits," US Attorney Damian Williams said in the announcement.
The arrest happened Tuesday in Ohio, where Gallagher lives.
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