Massachusetts Secretary of the Commonwealth William Galvin on Thursday said he had fined MML Investors Services $4 million over the firm's failure to supervise agents, including Keith Gill, who is also known on some social media sites as "Roaring Kitty."
The broker-dealer also agreed to overhaul its social media policies, according to a statement from Galvin's office.
MML Investors Services is the retail-focused broker-dealer subsidiary of MassMutual, the giant insurer.
Under consent orders signed this week, MassMutual has agreed to undergo an independent compliance review of its social media policies and trading by its broker-dealer agents. The company will also be subject to a three-year compliance audit.
Gill stopped working at MML Investors Services in February and is no longer registered with a broker-dealer, according to his profile on BrokerCheck.
"MassMutual is pleased to put this matter behind us, avoiding the expense and distraction associated with protracted litigation," a company spokesperson wrote in an email.
According to the consent order, Gill was employed by MassMutual from April 2019 until January 2021, a period in which he frequently posted videos and other materials online regarding investments and trading.
The period of Gill’s employment overlapped with his involvement in the GameStop and meme stock frenzy that occurred in late 2020 and early 2021, according to the regulator.
While employed by MassMutual, Gill was responsible for creating educational content for use by MassMutual broker-dealer agents to present to individuals, according to Galvin. At the same time that Gill was preparing those materials, he posted more than 250 hours of videos on YouTube, known by the moniker "Roaring Kitty," detailing investment strategies, which went unnoticed by his employer, as did at least 590 securities-related tweets posted by Gill, according to Galvin.
MassMutual failed to detect or monitor nearly 1,700 trades effected by Gill in the accounts of three other individuals, as well as transactions effected by Gill that were nearly double MassMutual’s per-transaction limit of $250,000.
Also without notice of his employer, Gill was able to execute at least two trades in GameStop in excess of $700,000.
A private partnership, Edward Jones is a giant in the retail brokerage industry with more than 20,000 financial advisors.
Meanwhile, Raymond James and Tritonpoint Partners separately welcomed father-son teams, including a breakaway from UBS in Missouri.
Paul Atkins has asked staff to solicit public comment on novel ETFs, pausing the clock on as many as 24 filings linked to the booming event contracts market.
From 401(k)s to retail funds, Deloitte sees private equity and credit crossing into mainstream investing on two fronts at once.
Big-name defections from Morgan Stanley, UBS, and Merrill Lynch headline a busy two weeks of recruiting for the wirehouse.
Wellington explores how multi strategy hedge funds may enhance diversification
As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management
