SEC Says It Is Investigating Market Mania For Possible Misconduct,The agency assured that there is a joint work with other regulators to identify illegal schemes in the purchase and sale of shares
Bloomberg
The U.S. Securities and Exchange Commission, which faces intense pressure to respond to the recent stock market craze, said it is trying to identify potential misconduct and will analyze broker decisions to stop purchases that triggered a retail investor revolt.
The SEC warned traders about engaging in illegal schemes to drive up stock prices and said it was working with other regulators, stock exchanges and federal agencies to "identify and prosecute possible crimes," according to a statement released Friday by Acting President Allison Herren Lee. and the agency commissioners.
The SEC leadership added that the agency "will closely review actions taken by regulated entities that harm investors may or unduly inhibit their ability to trade certain securities."
The comments were the most aggressive yet from the top Wall Street regulator after a week-long frenzy that has seen small investors take advantage of social media to boost GameStop Corp., AMC Entertainment Holdings Inc. and other stocks, the funds of hedging is squashed by their short bets, and Robinhood Markets and other brokers restrict trading in inflated securities.
By Friday, the restrictions had been lifted and the massive rally at GameStop and others was back on track. The stock had advanced 78% to $ 345 as of 12:25 p.m. in New York after rising as much as 114% earlier in the day.
Action required
The tumult has rocked the financial industry and prompted demands for SEC action from both Democrats and Republicans on Capitol Hill. The outrage reached a fever pitch on Thursday, and lawmakers expressed outrage
