Junk email, spam, is getting worse than ever. Even with an anti-spam filter, some junk emails that show up in the inbox are disgusting, deceptive, and aimed to con you out of your money. In addition to traditional spam emails promoting medication, mortgage, pornography, new ones such as stock scams are growing. The deceptive and unsolicited nature of these e-mails qualifies them as spam.
Stock scams, combined with traditional spam techniques, can cause a significant financial loss to victims of these swindles.
You might have noticed that many spams are touting a particular stock. These touts are sometimes made as part of a Pump and Dump scheme. Pump-and-dump scams are email campaigns which encourage people to invest in a particular company’s stock, in order to quickly inflate its value and enable the spammers to make a fast profit. It is thought that these scams take place unbeknown to the company involved. The purpose of the pump-and-dump stock spam is to quickly and cheaply disperse false information about a company’s stock, along with information obtained from recent press releases, to potential investors. Usually this is a slimly traded stock on a small exchange for only pennies a share.
By implying that recipients of spam emails are in possession of privileged information — such as news of an acquisition before a general announcement — spammers seek to persuade the gullible into purchasing particular stocks. If a significant enough number of easily-led individuals invest in the touted stock, a spammer can ramp up the share price so that existing shareholders can sell their shares at a profit. But when the fraudsters dump their shares, and then stop advertising the stock, the price often falls, and investors ultimately lose their cash.
What to do if you get spammed? How not to become a victim of stock scams?
The first thing you can to protect yourself against stock scams on the Internet and against spam on the whole is to setup an anti-spam filter, which will filter your messages before you receive them into your inbox. Most pump-and-dump spam emails contain the words like «stock», “invest”, «investor reports». But to bypass spam filters, spammers can use the variations of the word “stock” such as «st0ck» or «stox”. So, if your inbox is flooded with penny stock tip, ignore it. Delete it. Do not believe anyone who tells you, «Invest quickly or you will miss out on a once-in-a lifetime opportunity.» Just don’t go thinking this is your big chance to hit pay-dirt. It is sounds too good to be true. The only ones profiting from these «spam e-mail tips» are the senders themselves — in this case spammers.
The history of the stock market has shown that the best and most trusted way to build wealth is to invest in high-quality businesses with excellent growth opportunites.
Investigate before you invest. Find out who sent the message to you. Ask whether the claims can be documented. Verify whether the claims are true before you send a nickel of your money.
But if you yielded to temptation and became a victim pf a stock scam, you can hire a lawyer to try to get your money back, but you need to know that recovery is rare. Just remember that the best protection is to take no action and stay away from bad deals in the first place.