(New York Post) A Bed Bath & Beyond exec was facing a $1.2 billion “pump-and-dump” stock-fraud suit when he apparently leaped to his death from his swank 18th-floor apartment in Lower Manhattan last week.
Gustavo Arnal, who was the chief financial officer of BBB, is among the defendants named in a class-action suit that accuses him, Chewy.com founder Ryan Cohen and others of artificially inflating the troubled housewares giant’s share price.
The class-action complaint, filed Aug. 23 in Washington, DC, federal court, alleges that the scheme also involved “a classic attempt to spark a gamma squeeze.”
That tactic relies on the purchase of stock options and was employed during last year’s GameStop stock trading frenzy, according to The Motley Fool website.
Cohen, the chairman of GameStop, came under fire last month for making $68.1 million in profits by unloading a stake in BBB that reportedly included 7.78 million shares and options to purchase another 1.67 million.
Cohen’s lucrative 56% gain came about seven months after he first invested in BBB.
Bed Bath & Beyond CFO Gustavo Arnal was facing a $1.2 billion stock fraud lawsuit when he jumped to his death from his Manhattan apartment building
On Aug. 16, the same day Cohen cashed out, Arnal sold 42,513 shares of BBB stock worth more than $1 million, the MarketBeat website reported at the time.
On Sunday, Reuters said its calculations showed that Arnal had actually sold 55,013 shares but didn’t say how much he netted.
Arnal died Friday in what cops believe was a suicide plunge at 12:20 a.m. from his apartment at 56 Leonard St., a skyscraper known as the “Jenga building” because of its unique exterior, which resembles an uneven stack of blocks.
Arnal leaped from his apartment in the luxury “Jenga” building in Tribeca on September 2, 2022.Robert Miller
After the disclosure of Cohen’s and Arnal’s stock sales Aug. 17, shares in BBB fell from a “record high $30” to $8.78 on Aug. 23, according to the suit.
The stock closed at $8.63 a share Friday.
In court papers, plaintiff Pengcheng Si of Falls Church, Va., said she and her spouse bought 8,020 shares of BBB “at artificially inflated prices” between March 25 and Aug. 18 “and have suffered realized and market losses of approximately $106,480.”
Total damages to all BBB shareholders, including the company’s interests, were about $1.2 billion as of Aug. 23, according to the suit.
Other defendants in the suit include JP Morgan Securities, which is accused of helping Cohen and Arnal “effectuate” their sales “and otherwise launder the proceeds of their criminal conduct.”
BBB, which is named as the lead defendant, is accused of making a “materially false and misleading statement” in an Aug. 18 Securities and Exchange Commission filing that said, “We are pleased to have reached a constructive agreement with [Cohen’s] RC Ventures in March and are committed to maximizing value for all shareholders.”
The suit was first reported by the Daily Mail.
BBB said in a statement to The Post on Sunday, “We will not comment on litigation and ask that you please respect Mr. Arnal’s family and their privacy at this time.”
The class action lawsuit accused Arnal and others of engaging in a “pump-and-dump” scheme to artificially inflate the company’s stock price.REUTERS/Andrew Kelly
