The House Financial Services Committee will hold a much-awaited hearing on Thursday to question key players in the two-week trading frenzy that helped drive shares of GameStop, the challenged video game retailer, up more than 600 percent. Here’s who will be in the hot seat.
Keith Gill, known as Roaring Kitty
Mr. Gill, a registered securities broker, advocated shares of GameStop on Reddit but did not disclose his former job at MassMutual as a wellness education director. On Tuesday, Mr. Gill and his former employer were named as defendants in a proposed class-action lawsuit that claimed he misled retail investors who bought shares of GameStop during the rally.
Kenneth Griffin, Citadel
The Chicago billionaire is the founder and chief executive of Citadel Capital, the fund that has found itself attacked on all sides for its role in the trading frenzy. Citadel is a partner with Robinhood, which Citadel pays for the right to fulfill customers’ trades; it makes money by pocketing tiny price discrepancies between buy and sell orders. It also ran to the rescue of Melvin Capital to the tune of $2 billion, when the fund found itself in a squeeze as investors pushed to corner its short positions during the rally.
Vlad Tenev, Robinhood Markets
The Robinhood chief executive has ardently defended the company’s decision to halt purchases of certain stocks during the frenzy, saying mounting lending requirements caused a cash crunch at the online brokerage firm. In the weeks since the frenzy, Mr. Tenev has called for the elimination of the two-day period it takes to settle trades, which he argues was the cause of many of the issues.
Gabriel Plotkin, Melvin Capital Management
Mr. Plotkin’s hedge fund, Melvin Capital, became the source of ire for Redditors for its short position against GameStop. As buyers poured into the company, it faced a cash crisis that forced it turn to Citadel, its partners and Point72 Asset Management for $2.75 billion in emergency funds. Mr. Plotkin has said that threats in the aftermath of the trading frenzy have forced him to hire security for his family.
Steve Huffman, Reddit
The chief executive and co-founder of Reddit has defended r/WallStreetBets forum, the public hub for investors during the so-called meme stock frenzy, as a tool to help close the resources gap that benefits institutional traders. He has said that there wasn’t much his company could do to guard against market manipulation, but the forum “does a really good job showing how dangerous options investing can be, because in my history of watching that community, most of them lose money.” Reddit has taken advantage of surging interest, raising $250 million in new funding earlier this month in a deal that valued the start-up at $6 billion.
Jennifer Schulp, the Cato Institute
An expert on financial markets, Ms. Schulp (not Schlub, as was previously stated here) plans to testify that the meme stock phenomenon didn’t pose a systemic risk. Before joining Cato, she was a director in the enforcement department at the Financial Industry Regulatory Authority.