First finfluencer sentenced for market manipulation
![image](https://res.cloudinary.com/momentum-media-group-pty-ltd/image/upload/s--1Ya61RZ3--/c_fill%2Cf_webp%2Cg_center%2Ch_480%2Cw_855/v1/Money%20Management/gavel-2-mm_zfvryo.jpg?itok=SGPII8ff)
![image](https://res.cloudinary.com/momentum-media-group-pty-ltd/image/upload/s--1Ya61RZ3--/c_fill%2Cf_webp%2Cg_center%2Ch_480%2Cw_855/v1/Money%20Management/gavel-2-mm_zfvryo.jpg?itok=SGPII8ff)
Gabriel Govinda has been sentenced to two and half years imprisonment after pleading guilty to charges of share manipulation and illegal dissemination of information.
Govinda, known online as Fibonarchery, was sentenced at Melbourne County Court on 3 May to two and a half years imprisonment to be released immediately on a five-year recognisance in the amount of $5,000 and fined $42,840.
This followed Govinda pleading guilty to 23 charges of manipulation of shares listed on the Australian Securities Exchange and 19 charges of illegal dissemination of information relating to the manipulation.
Between September 2014 to July 2015, Govinda used 13 different share trading accounts, held in the names of friends and relatives, to manipulate the share price of 20 different listed stocks.
He also illegally disseminated information about his wash trades and dummy bids on HotCopper. He was seeking to increase (or pump) the share price, then selling (or dumping) the listed stocks at a higher price. This is often referred to as ‘pump and dump’.
ASIC noted a search of his premises in 2015 had uncovered a notebook which stated: “‘Buy big parcels of small cap cash backed resource shares at reasonable price, alert H.C Daytraders to the action sell to them at higher price at end of day.’ It also read ‘sell to self to create illusion of volume’ and ‘sell stock down to yourself then buy stock up to yourself. Buy cheap, make it expensive again, sell to others.”
For actions like this that took place after March 2019, the penalty for this crime had been increased to 15 years imprisonment.
ASIC deputy chair, Sarah Court, said: “Govinda used a social media forum as an integral part of his market manipulation. He promoted certain shares that he had an undisclosed interest in, and which he had manipulated, with a view to selling out at a higher price.
“‘Individuals who look to social media, whether that be online forums or via platforms such as Instagram and Facebook, to promote stocks or financial products, should take notice of today’s court decision. Finfluencer conduct, whether by using social media to manipulate the market, using a platform to profit from promoting manipulation done by others, or to promote financial products you are not licensed to promote, can result in serious consequences.”
The Commonwealth Director of Public Prosecutions prosecuted the matter after a referral from ASIC.
Recommended for you
A NSW-based adviser has been banned from providing financial services for five years for inappropriate advice and the AFSL of his business has been cancelled by ASIC.
The introduction of Rhombus Advisory has caused a shift in the top advice licensees as Insignia separates its advice business into two channels.
Given the clear divergence between the cost of financial advice and clients’ willingness to pay, two experts explore how advisers can transform the way they convey value to potential clients.
Nearly 18 months since Invest Blue adopted its nine-day fortnight structure to support employee wellbeing, the national advice firm has enjoyed positive results across all metrics.
Add new comment