SEC v. Gallagher

Violations Charged

Section 17(a), Section 9(a)(2), Section 10(b), Rule 10b-5

Case Overview

From December 2019 to October 2021, Steven Gallagher used his Twitter account, @AlexDelarge6553, to post buy 'Alerts' for penny stocks to more than 70,000 followers while selling his own shares into the resulting buying, a practice known as scalping. According to the complaint, he 'loaded' millions of shares first, notified private chat rooms that an alert was coming, then sold within hours of tweeting.

Across at least 60 stocks, the complaint put his profits at no less than $3.39 million. On occasions he posted false information about the promoted companies, stated he was not selling while he was, and placed end-of-day buy orders in two stocks to affect their closing prices. His brokerage firm issued written warnings and closed his account; he opened an account at another firm the same day.

Joe's Role

The SEC's press release announcing the charges names Joe among the staff who conducted the investigation.

Outcome

The court granted a TRO and an asset freeze of up to $6.9 million the same day the U.S. Attorney's Office for the Southern District of New York announced parallel criminal charges. In September 2025, a jury returned a verdict for the SEC on its claims.