Insurer MassMutual to Pay Massachusetts Securities Regulators $ 4 Million in Settlement Involving the Conduct of Keith Gill, a Former Employee and Online Trader Known as “Roaring Kitty Whose relentless cheerleader for GameStop actions was at the heart of the same stock mania earlier this year.
Regulators said the MassMutual unit that employed Mr. Gill, who resigned in January, failed to adequately oversee his business and online activities, as well as those of other agents. In addition, Mr. Gill was trading on behalf of three other individuals not affiliated with MassMutual without the insurer’s knowledge, according to the regulations. The insurer neither admitted nor denied the charges, but accepted the fine along with an independent compliance review and other measures.
“MassMutual is happy to put this case behind us, avoiding the expense and distractions associated with protracted litigation,” said a spokesperson.
Mr Gill has cultivated a huge online following with over 250 hours of YouTube videos detailing his opinions on GameStop, a struggling video game retailer that was once a mainstay of shopping malls but whose stock has languished in recent years. However, GameStop has become a favorite with masses of day traders who loosely organized themselves on Reddit’s WallStreetBets trading forum and briefly pushed the company’s stock price up to 600% in a matter of days in late January.
Mr. Gill’s videos – he filmed himself sitting in a video game chair wearing his trademark red headband – were informal and irreverent. But even as his fame online grew, it was virtually unknown that he was a registered stockbroker, and until his resignation in January, he worked as the director of financial wellness education at MassMutual, officially known as Massachusetts Mutual Life Insurance Company.
“As far as MassMutual is concerned, they were obviously totally at fault for not having supervised him,” William F. Galvin, the secretary of the Commonwealth, said in an interview. “I mean, it was beyond a little negligence case. It was thorough and thorough.
Mr. Gill regularly updated his personal position on GameStop publicly, posting his trades on Reddit under the recurring “GME YOLO Update” heading. But the settlement said Mr. Gill also made nearly 1,700 transactions in the accounts of three other people. What was exchanged and the identities of the people were not disclosed.