Comments on: Penny Stock Pump and Dump Scams

By: Be Careful Where You Get Your Investment Advice | Military Finance Network

Be Careful Where You Get Your Investment Advice | Military Finance Network — Tue, 07 Oct 2008 14:11:28 +0000

[...] Who is giving you this information? Is it your broker, who gets a commission on every trade? Did you get this info from an “insider e-mail,” a voice or fax that was sent to the wrong number, or a mailer touting the latest oil discovery in Canada? In the first case, your stock broker may just be looking to make a few extra bucks by churning your account. In the second instance, you may be falling victim to a penny stock pump and dump scam. [...]

By: WR - Fantasy Football Edition

WR - Fantasy Football Edition — Sun, 24 Aug 2008 16:02:44 +0000

[...] Mrs. Micah has tips on how to avoid Penny Stock Pump and Dump Scams. [...]

By: Daddy T

Daddy T — Thu, 21 Aug 2008 13:04:52 +0000

I like the wisdom of your “maintain a healthy criticism. You are “right on the money” there.

By: Paul

Paul — Wed, 20 Aug 2008 13:44:48 +0000

Great article. I never thought about this subject before. Thanks for highlighting it!

By: Jeff

Jeff — Wed, 20 Aug 2008 12:29:14 +0000

mrsmicha, loved your write up. Not sure I share you aversion to penny stocks. http://www.timothysykes.com/ has some great information on how to profit from penny stocking and he really does a great job cutting through the industry BS.

By: Scott @ The Passive Dad

Scott @ The Passive Dad — Wed, 20 Aug 2008 03:09:28 +0000

It’s funny, when I worked for an investment bank I would receive some really cleaver faxes. On one occasion I really had to do a double take and actually go to Bloomberg and check to see if the stock was legit. The fax had a hand-written note that said something like “Hey Bill, you gotta see this one” or “Bill, I just picked up 10,000 shares and you should do the same before the government ruling comes out”. Very clever deceptive spamming that was being done. I think now more of these faxes are being used and they certainly do catch you attention.

By: mrsmicah

mrsmicah — Tue, 19 Aug 2008 22:10:07 +0000

Exactly, Steward! As long as I considered it entertainment then it could be fun. The trouble comes when people try to get rich from it.

By: Steward

Steward — Tue, 19 Aug 2008 22:04:26 +0000

I think I wouldn’t mind buying a penny stock just to drop the fact that I owned 3000 shares of a stamp company. It would make me sound rich, and possibly famous. Then when the stock jumped by 20% (lets say $0.01, from $0.05 to $0.06) I would sell off all my holdings and brag about how I made a 20% profit on my holdings.

That would make me happy.

By: mrsmicah

mrsmicah — Tue, 19 Aug 2008 18:18:27 +0000

@Michael, that site looks quite useful for figuring out what sorts of scams are going on. But I wouldn’t feel comfortable getting mixed up in one a) because I don’t feel it’s ethical to profit from a scam, even if you’re not the scammer and b) if I didn’t worry about the ethics, I don’t trust like investing that’s time-critical.

Sometime in the future it’s entirely possible that I’ll buy maybe $25 or $30 in REALLY low-priced penny stocks for pure entertainment value. Because owning a large number of shares of something worthless would amuse me as long as I did it on purpose. And I didn’t have to store it (stocks are handy that way). And it didn’t cost much.

By: Michael

Michael — Tue, 19 Aug 2008 18:06:29 +0000

It's possible to profit from stock scams by aggregating and monitoring them. http://www.qwoter.com/spam.php