HOW MOST PUMP AND DUMP SCAMS WORK:
* A person sees an investment opportunity on social media
* The post uses the image of a well-known commentator, investor or financial institution to build credibility
* The opportunity is actually fraudulent, generated by the scammers
* The consumer clicks the post and is directed to a messaging platform such as WhatsApp
* A scammer impersonating the expert provides stock recommendations, often on foreign exchanges
* Fake investors, often part of the scammer’s team, post messages about their supposed profits to build credibility and reel the victim in
* The victim buys the recommended shares, causing the share price to rise (scammers often ask for screenshots or proof of purchase)
* The scammers suddenly sell their existing holdings at the inflated price, causing the price to collapse
* The victim is left holding shares worth significantly less than what they paid
WHAT TO DO IF YOU ARE SCAMMED
* Call your bank as soon as you realise it’s a scam
* Seek support through ID Care if you need to recover your identity
* Help others by reporting scams to Scamwatch
* Unfortunately, scammers are often overseas and out of reach of Australian law
* The chances of getting your money back are very low
Australian Associated Press
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