According to a recent report, the public stock trading platform E-Trade is having internal discussions about whether or not it should ban Keith Gill, otherwise known as “Roaring Kitty,” over potential market manipulation.
The report comes from the Wall Street Journal, which shared that the Morgan Stanley-owned brokerage hasn’t yet made a decision on what it will do, but people familiar with the matter say the discussion is being had inside the firm.
After nearly three years of silence, Roaring Kitty returned to X last month, posting a meme that sparked a jump in two iconic meme stocks, GameStop and AMC. Last month, share prices for GameStop jumped from around $13 per share to $50 at their peak.
They are still more than double their worth from before Gill’s post.
When asked to confirm the Journal’s report, multiple new sources were denied, with E-Trade saying, “We don’t publicly discuss the individual activity of our clients.”
Morgan Stanley’s global financial crimes unit and external counsel are at the front of the debate regarding Gill’s account, the Journal reported.
The brokerage discovered in May that Gill had purchased a substantial amount of call options before he posted on social media, and some of those contracts expired that week, most likely providing him a profit, the Journal shared.
Last month, experts shared that there was no explanation for the jump in GameStop’s price other than Gill’s post on social media. Neil Wilson, chief market analyst at Finalto, shared with CNBC that because of him many would take the risk.
“It looks like retail investors are becoming more bullish again and willing to take on more risk,” Wilson said in a note. “There is no fundamental reason for the move as such - GME’s last earnings report was abysmal.”