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Compliance Lessons Gleaned from GameStop Market Insanity

February 2, 2021

Since last week, Wall Street has been watching a real-time battle unfold between retail investors and hedge funds over formerly moribund stocks like GameStop, AMC Entertainment, and BlackBerry, which is causing regulators and lawmakers to be on alert.

Foreside’s Craig Moreshead, Managing Director, spoke with Compliance Week’s Aaron Nicodemus sharing that this specific case raises a novel question of whether someone can be charged with stock manipulation if there is no profit motive, but instead, the explanation is some political message or to harm some other pool of investors (in this case, large Wall Street hedge funds with short positions)

Click here to learn more about compliance takeaways, specifically how the compliance-risks for broker-dealers and investment firms from social media-driven market volatility are threefold; financial risk, regulatory risk, and reputational risk.