Investors lose billions on US penny stocks as 'pump and dump' scams multiply
1-800-522-4700 for anyone humoring these kinds of "investments"
Amusing and true.
> The National Council on Problem Gambling operates the National Problem Gambling Helpline Network (call: 1-800-522-4700)
It's common for pump and dump to be extremely obvious. The reason for this is that many-- in some cases, virtually all-- of the victims/targets are aware it's a P&D and they believe they're going to get out early and leave some sucker holding the bag. In reality, they're the sucker.
Articles like this that discuss the subject and show graphs of spectacular rises without mentioning that people who know its a P&D are frequently among the victims might contribute to the problem. ... While some readers see this and can now recognize a P&D some of them are looking at that graph and thinking "when I next see a P&D I'll join in and exit >>here<<".
Scams are allowed but if you want to raise money for a new real company the stock markets are just not an option due to costly regulations.
What are we doing here now.
The public stock markets were never intended to raise capital for new companies. Companies usually have to have at least some track record before an IPO.
I feel like if people could just ask themselves some basic questions like "why is this person offering to give me money for free?" 90% of scams would disappear.
It's so frustrating how people see someone claiming to have made tens of millions trading crypto or whatever selling a course for $1000 and not immediately question why they would be doing that
Sure, but a significant fraction of scam victims are older people suffering from cognitive decline who are losing the ability to ask themselves basic questions. Scammers have a long window of opportunity between when this mental condition starts and when relatives or government authorities establish some sort of financial conservatorship to protect them. This problem will only get worse with an aging population.
Maybe this is a class thing, but legal conservatorships are heavyweight and not so common. The usual route is more like DPoA + assume responsibilities with new accounts + supervised use of remaining low-value accounts. And that's usually after "something happens".
See my other comment: many do ask themselves that, in this case they reach the answer that it's a P&D and they think they can profit from it.
> or whatever selling a course
so some of those 'investor group' things the perpetrator spins it as that they're so rich that they're bored and lonely, and this trick is the thing they know best but they don't need it any more because they're already rich. Sometimes there are hints that the approach isn't 100% legal and so it's unwise for any one person to do too much of it.
Keep in mind the goal of the fraudster is not to convince everyone or even most people. Their goal is to have a few people who are very convinced, such that they'll part with large amounts of money. They don't mind convincing more, of course, but often the narrative that creates true believers is incompatible with ever catching a lot of people.
The scam seeing stupid in hindsight or that it makes its victims seem greedy or crooked themselves is a major advantage too, because it makes the victims much less likely to speak out or try to recover their losses from the perp.