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E-Trade is having internal discussions about whether to ban Keith Gill—the meme stock trader who just revealed a large position in GameStop—from the trading platform over concerns about potential market manipulation. The Wall Street Journal reported this on Monday.
Brokerage company owned by Morgan Stanleyhas not yet made a decision, the publication reported, citing people familiar with the discussions within the firm.
GameStop shares surged early Monday morning after Gill, who goes by DeepF ——Value on Reddit, posted a screenshot of what could be his portfolio containing a significant amount of GameStop common stock and call options. The meme stock leader owns 5 million shares of GameStop and a position of 120,000 call options with a $20 strike price expiring on June 21, purchased for about $5.68 per share, as shown in the screenshot.
E-Trade declined to comment to CNBC, noting that “we do not publicly discuss the individual activities of our clients.”
Morgan Stanley’s financial crimes unit and outside counsel began discussing whether Gill’s account should be canceled because the firm was monitoring his account activity, the Journal reported.
The brokerage discovered that Gill had bought call options in May before posting on social media platform X, the Journal reported, adding that some of those contracts expired this week, meaning he likely made a profit.
The meme stock mania of 2021 has led to a series of congressional hearings, including Gill’s testimony, on brokerage practices and the gamification of retail stock trading. Gill also faces several class-action lawsuits, including one alleging that he pretended to be an aspiring trader despite being a licensed professional.
Gill served as the Marketing and Financial Education Associate at MassMutual in 2019 and 2020.
— Click here to read WSJ story.