PUMPERS & DUMPERS: Social Media Influencers Charged in Scheme

By Staff Reporters



DEFINITION: Pump and dump (P&D) is a form of securities fraud that involves artificially inflating the price of an owned stock through false and misleading positive statements, in order to sell the cheaply purchased stock at a higher price. Once the operators of the scheme “dump” (sell) their overvalued shares, the price falls and investors lose their money. This is most common with small-cap cryptocurrencies and very small corporations/companies, i.e. “microcaps“.

CITE: https://www.r2library.com/Resource/Title/082610254

While fraudsters in the past relied on cold calls, the Internet now offers a cheaper and easier way of reaching large numbers of potential investors through spam email, investment research websites, social media, and misinformation.


And so, Federal prosecutors and the SEC have accused seven popular Twitter and Discord users of wielding social media to manipulate stock prices—pumping the shares and then selling off mass quantities for profit once they rose.

An additional defendant, whose Twitter handle was @DipDeity, was charged with aiding and abetting the alleged fraud for hosting a podcast that featured and promoted the seven influencers as skilled traders to follow.

Each influencer charged had well over 100,000 followers and, according to the SEC, the group earned about $100 million total in the scheme.


ORDER: https://www.routledge.com/Comprehensive-Financial-Planning-Strategies-for-Doctors-and-Advisors-Best/Marcinko-Hetico/p/book/9781482240283



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One Response

  1. P&D

    Seven social media influencers have been charged in an extensive stock scheme that brought in millions of dollars.

    According to the Securities and Exchange Commission, at least seven people with massive social media followings are accused of using Twitter and Discord to promote themselves as “successful traders” and recruiting hundreds of amateur investors to invest in stocks they’d also purchased. However, they never informed their followers that they were planning to sell shares once costs or trading volumes increased. Through this inflation process, the influencers made a combined $100 million.

    The scheme goes back to at least 2020, which would have been an attractive way for people out of work to make some extra cash during the COVID-19 pandemic. Sadly, the Department of Justice says the group was feeding their followers misinformation about trading, which caused many to lose money.



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