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U.S. SEC obtains asset freeze to halt alleged penny stock scheme on Twitter

Oct 26 (Reuters) - The U.S. Securities and Exchange Commission said on Tuesday it filed an emergency action, and obtained an injunction and asset freeze, against an individual for allegedly committing securities fraud through a scheme to manipulate stocks using Twitter.

The SEC alleges that, since at least December 2019, Steven Gallagher used his Twitter handle to send thousands of tweets encouraging his numerous followers to buy stocks in which Gallagher had secretly amassed holdings. Gallagher would then sell the stocks at inflated prices, while continuing to recommend that others buy them without disclosing he was selling the stocks, according to the SEC's complaint bit.ly/3bgJua1.

Reporting by Kanishka Singh in Bengaluru; Editing by Leslie Adler

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