Billionaire Ryan Cohen's 2022 purchase and abrupt sale of Bed Bath & Beyond shares are being investigated by the SEC, report says
- Meme-stock investor Ryan Cohen's 2022 trades in Bed Bath and Beyond's stock are being probed by the SEC, per the WSJ.
- The billionaire took a $120 million position in BBBY stock in early 2022, but sold it abruptly five months later.
Billionaire Ryan Cohen's abrupt sale of Bed Bath & Beyond shares during last year's meme-stock craze is under investigation by the Securities and Exchange Commission for alleged securities fraud, according to the Wall Street Journal.
The investor, whose firm acquired a 9.8% holding in the embattled homeware retailer in March 2022, sold his stake five months later without warning and just days after tweeting positively about the company.
Cohen, who also chairs video game retailer and fellow meme stock GameStop, scored a profit of almost $60 million following the sale, the WSJ reported.
A week before selling his shares, Cohen had replied to a CNBC story on Bed Bath & Beyond with a picture of a woman pushing a shopping cart at the store, tweeting, "At least her cart is full," followed by a smiling moon emoji.
"In the meme stock 'subculture,' moon emojis are associated with the phrase 'to the moon,' which investors use to indicate that a stock will rise,'" Washington DC district judge Trevor McFadden said during the initial legal proceedings in July 2023. "So meme stock investors conceivably understood Cohen's tweet to mean that Cohen was confident in Bed Bath and that he was encouraging them to act."
Cohen denies the allegations. In a court filing, he said he sold because the stock price had "unexpectedly increased to a value that exceeded what he believed it was worth."
In April 2023, Bed Bath & Beyond filed for Chapter 11 bankruptcy and closed hundreds of stores across the US.
Cohen didn't immediately respond to a request for comment from Insider.