In a letter (pdf) to the Securities and Exchange Commission (SEC) on Friday morning, Sen. Elizabeth Warren (D-Mass.) questioned price swings on stocks like GameStop, AMC, and others and asked for the agency to address “any systemic concerns for financial systems.”
“Casino-like swings in stock prices of GameStop reflect wild levels of speculation that don’t help GameStop’s workers or customers and could lead to market instability. Today I told the SEC to explain what exactly it’s doing to prevent market manipulation,” Warren wrote on Twitter.
Warren, who has painted herself as a champion of Medicare for All and similar policies, said the SEC now needs to review the market activity around GameStop to “act to ensure that markets reflect real value, rather than the highly leveraged bets of wealthy traders or those who seek to inflict financial damage on those traders.”
“To protect and restore public trust in sound securities regulation and enforcement, the Commission must identify gaps in existing securities laws and rules and ways in which the Commission can improve its enforcement capabilities,” Warren wrote in a news release accompanying the letter, adding that she asked the SEC—the chief financial regulator in the United States—to respond to her question by Feb. 5.
A number of elected officials in Congress—both Democrats and Republicans—have seized on the GameStop development, calling for hearings and investigations into the matter.
Among them, Rep. Paul Gosar (R-Ariz.)—an ardent supporter of former President Donald Trump—called on the Department of Justice to investigate trading platforms like Robinhood after they halted the purchase of GameStop, KOSS, AMC, and other stocks.
“This unilateral move was done in a concerted effort to de-platform and silence individual investors,” Gosar wrote.
“We’re pleased to share that we’ve raised over $1 billion from existing investors to continue to invest in record growth. This is a strong sign of confidence from investors that will help us continue to further serve our customers,” a Robinhood spokeswoman said in an email.
Reuters contributed to this report.