Some wealthy and famous individuals have the power to influence the stock market simply by posting on social media. For example, a famous billionaire tweets "I'm excited to see what ACME develops this year", and the Acme Corporation's stock price (at least temporarily) goes through the roof.
Now imagine that the billionaire capitalizes on the inflated stock price and sells for a big profit. Is this illegal, and if so what type of fraud would it be classified as? It feels like a pump & dump, but doesn't meet some of the typical criteria for a pump & dump:
- There is no orchestrated campaign, merely a single social media post
- The individual in question hasn't made any false / misleading claims
- The individual in question hasn't advised anyone else to buy the stock
For comparison, John McAfee was charged for running a pump & dump on Twitter, but his campaign did meet the traditional criteria for a pump & dump.