BOSTON (WWLP) – MML Investors Services, LLC, a subsidiary of MassMutual, has been ordered pay a $4 million fine and examine their social media policies over the company’s failure to supervise agents.
Secretary of the Commonwealth William Galvin’s office sent a news release and copy of the consent order to 22News that outlines the charges and agreement with MassMutual.
At the center of the investigation is Keith Gill, who is also known on some social media sites as “Roaring Kitty.” According to the consent order, Gill was employed by MassMutual from April 2019 until January 2021, when he posted more than 250 hours of videos and at least 590 securities-related tweets online regarding investments and trading, of which the company was unaware. During his time with the company he was also involved in the GameStop and meme stock frenzy that occurred in late 2020 and early 2021.
“It’s clear that MassMutual was not as diligent as it should have been in supervising its employees,” Galvin said. “It took the media less than a day to identify the person behind the Roaring Kitty posts, while his own employer took no notice of his online persona.”
The investigation found that 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, including at least two trades in GameStop in excess of $700,000.
MassMutual has agreed to pay a $4-million fine, submit to an independent compliance review of its social media policies and trading by its broker-dealer agents, and train agents concerning social media and personal trading. Per a separate consent order, the company has also been ordered to seek registration of 478 broker-dealer agents and pay a $750,000 administrative fine.
An inquiry into Keith Gill’s registration in Massachusetts is still pending.
MassMutual provided this statement to 22News:
“MassMutual is pleased to put this matter behind us, avoiding the expense and distraction associated with protracted litigation.”Laura Crisco, Head of Medial Relations/Strategic Communications, MassMutual