Galen McNamara

Galen McNamara

05-11-2022

22:20

This is called front-running. It’s a long-standing stock manipulation tactic as deceitful as the day is long. Come with me on a Saturday afternoon fintwit journey This is my first-ever thread. @BCSC @OSC @SEC @IIROC

This story features masked insecurity, a lord-and-peasant mentality, shockingly poor ethical standards, and attempted extortion that may all add up to securities fraud. Get your popcorn ready.

Imagine for me that you run a subscription stock-touting service. You put the word “research” in the title to convey confidence. You know what you’re talking about. You have deep insight. You are so smart that you can charge €550 per year to your subscribers.

In fact, you know you are always the smartest person in the room. And if anyone doesn’t believe it, just ask because you’ll be happy to tell them. You are the oracle of your own little world lording over the peasants lucky enough to have found you.

Sound crazy? It is. It's all just smoke screen to mask your ignorance. You have no experience. You have never done anything of significance. You have no idea of what it takes to be successful. Everyone wins in bull markets, and everyone loses in bear markets. You don't know this

Let’s keep working with our imagination. You pick stocks. You tell your subscribers what you’re buying and selling. One day you find a stock that you feel is deeply undervalued. You tell everyone because you need to come up with picks to keep yourself relevant and generate cash.

This company has strong projects and a good team. You are going to look so smart and make so much money. People will like you. More importantly, people will respect you. This will show all those bullies from your past. Finally, respect!

Unfortunately, this is not wallstreetbets and you are not TheRoaringKitty. The Company exists in a marketplace suppressed by long running bearish conditions. The company sheds very significant value over time.

Nobody is happy. Least of all management. The company faces, solves, and shares major operational challenges it has experienced. Even companies with more advanced projects and more gold ounces have lower market capitalizations.

You don’t care. This one is special because you picked it. Why is this happening to you? You contact management repeatedly to complain. This is fair and they respect you as a shareholder.

You try to bully management and demand that they give you material insider information. You threaten to tell everyone to sell. You threaten to ruin the company. Your extortion is not successful. This is Fraud #1.

This makes you angry. You refuse to take responsibility. Don’t they know who you are? One day, after months of complaining and unsuccessfully attempting to extort management for insider info, you sell in bulk.

You do so immediately with no regard to market depth. You do so knowing it will crash the stock. In fact, crashing the stock is your plan. That will show them!

You don't care about the investments of your paid subscribers. You only tell them what you’ve done afterwards so that they will sell too. This will hurt the company more. Good!

You imply that you have negative insider information. This is false. As you have planned, further intense selling occurs. That will show them even more!

The implication that you have traded while having insider information is a crime you have likely broken securities laws. You don’t care. You’re too smart for the rules! This is Fraud #2.

Unfortunately for your subscribers and all other shareholders, you do not have insider information. You have now lied to people who pay you.

But wait! Since you sold first you got a better price for your shares than your subscribers. Who cares if its front-running. If prominent politicians do it, so can you! Those subscriber peasants are lucky to have you! This is Fraud #3.

When the dust settles, you calm down and realize that you have probably broken the law. This is a problem for you. You don’t have a lawyer. You need one.

You reach out to directors of the company and ask to speak with them to “tell the true story”. They consider it then refuse. In fact, they will never speak to you again.

You are ridiculed widely. Even worse, you get no respect. Everyone is laughing at you. You are now alone in The Wilderness. Thank-you for reading.



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