Meme stock king Ryan Cohen’s ownership and sale of Bed Bath & Beyond stock, which sparked outrage, is under investigation by the SEC a year after the ouster of the company’s chief financial officer, Gustavo Arnal

The U.S. Securities and Exchange Commission (SEC) has opened an investigation into billionaire Ryan Cohen’s ownership and sudden sale of Bed Bath & Beyond stock last year.

Cohen, the so-called “meme stock king,” famously took a $120 million stake in the company, pushed for change and hyped the stock on social media, leading to hype that sent the stock up $34 in one day percent skyrocketed.

But just days after making positive comments about the company, Cohen sold his shares in August 2022, triggering the company’s collapse. The investor, currently chairman of GameStop, earned nearly $60 million from the five months of trading.

Months later, Bed Bath & Beyond filed for Chapter 11 bankruptcy — and its CFO Gustavo Arnal, 52, died by suicide after jumping from the Jenga Tower in New York City, after shareholders filed a lawsuit against him, the company and Cohen over alleged Pump and dump strategy

The SEC now wants Cohen to provide information about his dealings and communications with officers or directors of home goods retailer The Wall Street Journal reported on Thursday.

GameStop Chairman Ryan Cohen earned around $68 million after selling shares in Bed Bath & Beyond

The company’s shares stagnated after Cohen sold his shares last August

U.S. District Judge Trevor N. McFadden called the timing of Cohen’s dealings “sketchy” in a July order.

The regulator also sought documents from some of the company’s current and former board members, according to the outlet.

Cohen, who is currently chairman of GameStop, announced a nearly 10 percent stake in Bed Bath & Beyond in March 2022 and wanted the company to explore strategic alternatives, including an outright sale.

That same month, Bed Bath & Beyond and Cohen agreed to add three new directors to the company’s board, and the retailer agreed to explore alternatives for its Buybuy Baby division.

However, in August, a regulatory filing showed that Cohen had exited his position in the company after a stunning rally during the month.

Bed Bath & Beyond and the SEC did not immediately respond to requests for comment. Cohen could not immediately be reached for comment.

SEC investigations can take years and do not always end with allegations of wrongdoing.

Cohen’s investment in the company was significant because of his following among small retail investors, driven by his role in the GameStop frenzy.

Between 2020 and 2021, he encouraged traders on Reddit and other social media sites to buy shares of the video game retailer, a company that mainstream investors had written off.

Arnal jumped to his death from the 18th floor of a 57-story building in Manhattan’s Tribeca neighborhood

Gustavo Arnal, 52, was sued a week before his death for allegedly inflating the price of Bed Bath & Beyond stock as part of a get-rich-quick scheme

The stock rose from $5 to over $480 – giving rise to what is now known as a “meme stock.”

Arnal jumped to his death from the 18th floor of a 57-story building in Manhattan’s Tribeca neighborhood

Their strategy is to use a “short squeeze,” where those betting against a stock are forced to buy shares to close out their position.

In September 2022, shareholders filed a lawsuit alleging that Cohen was aware of negative news about the company when he sold his shares and failed to disclose the information.

Cohen and 21-year-old math student Jake Freeman cashed out within 24 hours in August last year – before the company’s share price plunged at the end of this week.

Although it was Cohen’s interest in BBBY that resulted in a rise in the company’s value, it was Freeman who got out first and pocketed the lion’s share of the $180 million return.

Freeman, who attended the University of Southern California, purchased $25 million worth of BBBY stock through his Wyoming-based holding company Freeman Capital.

He raised the funds through friends and family, but also demonstrated exceptional ambition and intellect from a young age.

College student Jake Freeman, who “likes swimming,” earned $110 million after buying $25 million worth of stocks

Freeman first raised concerns about the company’s future in a letter to his directors in July, warning of an “existential crisis.” He suggested that the company could solve its financial problems by offering bondholders stock warrants and convertible bonds in exchange for the company’s debt haircut.

But a month later — on a day when the stock rose above $27 a share (he had bought it for $5.50) before closing at $20.65, up 31 percent — he sold his share.

His shares were reportedly worth more than $130 million at the time.

A day later, Cohen announced his intention to sell his 10 percent stake acquired through his venture capital firm RC Ventures. At the end of the following day, BBBY was down 20 percent.

Arnal’s suicide came days after the struggling retailer announced it would close stores and lay off workers.

According to reports, his 28-year-old wife Alexandra Cadenas-Arnal was in the apartment when he suddenly jumped to his death.

It also followed news that Arnal was included in the shareholder lawsuit over allegations that he artificially inflated the company’s share price as part of a “pump-and-dump” scheme.

The major retail chain, once considered a so-called “category killer” for home and bathroom products, has suffered an economic downturn after trying to sell more own-brand items.

In June, the bankrupt retailer was sold at auction for $21.5 million, a deal that would see all stores closed and the brand survive in name only.