The “pump-and-dump scheme”
Fraudsters are using social media platforms to lure you
Here is the scheme laid out for you: The scammers embark upon a “FOMO” or purchasing frenzy for a particular stock. This inflates, or “pumps” up, the price to a place they can “dump” the shares they purchased at the new, fun, inflated price. Of course, the stock will have it’s final moments and crash and all those who invested during the frenzy are now chewing on worthless shares. Financial lenders and support entities put out warnings for us, and considering we are in the tech industry, we figured we will keep sharing what we learn.
How they do it
These scammers will make false and “catfish” social media profiles of famous celebrities, financial professionals, and other experts to gain your trust and your credibility. We are all used to the scam calls and texts now so they had to move into the social media platforms and other platforms that we trust and spent a lot of our time on.
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| • | Get-rich-quick (too-good-to-be-true). NO reputable financial institution is going to reach out to you on social media. |
| • | Stock purchase manipulations. Guiding you step by step, asking you specific security questions or trying to “help you” with educating or information. Never follow investment directions from someone you don’t personally know or haven’t met and seen their credentials. |
| • | Coaching and baiting. Initiating trades or transactions yourself may seem like you are in control, but who baited you there? Who led you there and what do they have to gain? |
As always, we want you safe out there, after we set up your telecommunications with the world-wide-web. We will keep sharing the tips and tricks as they come in.
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