There’s no indication in court documents that Anson worked directly with Markopolos. He didn’t respond to messages seeking comment.
Doxtator estimated the trades yielded millions of dollars in profit and said Kassam had promised to pay him 15% of any proceeds, according to court records. Kassam told the court that he and Doxtator were in touch on WhatsApp during the bets and that they made just over $121,000. That meant the researcher’s 15% cut would amount to $18,000.
The lawsuit is still pending. As part of its probe, the Justice Department has been asking short sellers for information on their wagers against GE, as well as dozens of other stocks, according to people with knowledge of the matter.
Genius Bet
Even the trade that Kassam calls Anson’s most profitable long bet has attracted controversy.
In 2017, the firm began betting on children’s television programming company Genius Brands. In an interview published by ValueWalk last month, Kassam said he believed in the quality of the company’s content and provided financing to get cartoons into production.
Anson ramped up the stake in early 2020, according to a lawsuit filed by another Genius Brands shareholder. Anson was allegedly among a group of noteholders that reached a deal to pay 21 cents a share with a promise not to sell for a few months, while other investors acquired stock with a lockup period of 1 1/2 years. Several weeks later, the share price rocketed upward, briefly soaring beyond $11 amid a flurry of online commentary suggesting Walt Disney Co. or Netflix Inc. could buy the company. Neither ever did.
The shareholder lawsuit estimates Anson and the other defendants made more than $100 million on the stock’s flight. Anson has asked the court to dismiss the case.
Meanwhile, other stockholders haven’t fared nearly as well. Genius eventually gave up much of the gains and is now back to trading for around $1.
—With assistance from Katia Porzecanski and Layan Odeh.
This article was provided by Bloomberg News.