Do We Really Need Software To Catch Pump And Dump Stock Spammer Transactions?

from the is-it-that-difficult? dept

A few years ago, there was a study that showed that pump-and-dump stock spam scams actually made money for the scammers. However, what no one has been able to explain is why it isn't easy to track down those responsible. Just find out who bought a bunch of the stock just before the spam went out -- and who sold it all as others started buying up the stock. Sure, it's likely that scammers will try to cover their tracks, somewhat, but it shouldn't be that hard to track down who bought and sold early. In fact, it seems like it would be rather easy. So while we appreciate efforts like this new software that tries to notice such a pump-and-dump in action and alert traders of a potential issue, it's still not clear why this is really an issue at all. It still doesn't explain why we're simply not going after those who made money from the pump-and-dump scam in the first place. And, of course, there's the flip side of the argument: if you're suckered into buying a penny stock based on a spam email, some might say you deserve to lose your money.

Filed Under: pump and dump, scams, spam

Spammer Alan Ralsky Finally Indicted

from the and-not-just-for-spamming dept

If you've followed the spam world at all over the years, you know the name Alan Ralsky. He was considered a top spammer for many, many years, and was sued by Verizon at one point back in 2001. However, many in the tech world know him best for an incident in 2002. The Detroit Free Press did a story on Ralsky, where reporter Mike Wendland interviewed him, and had him show off "the house that spam built," an 8,000 square-foot house in a Detroit suburb. That story made its way to Slashdot -- where some commenters decided to publish the address of "the house that spam built," leading many, many, many Slashdotters to sign Ralsky up for all kinds of physical junk mail. Ralsky did not see the irony. Three years later, Ralsky's house was raided by the FBI during an investigation, but nothing more was heard about that case, until now. It took over two years, but Ralsky and a bunch of others have been indicted -- and the spam part should be the least of his concerns. The charges include: "conspiracy, fraud in connection with electronic mail, computer fraud, mail fraud and wire fraud." That's because Ralsky wasn't just spamming products for sale, he was using a botnet to run a pump-and-dump scam on Chinese penny stocks. It's unclear why it took over two years for the indictment to finally show up, but there are likely to be quite a few folks in the anti-spam community who are thrilled that something finally happened to Ralsky.

Filed Under: alan ralsky, pump and dump, spam, stock fraud, wire fraud

SEC Suspending Trades On Spam Scam Stocks

from the about-time dept

Pump and dump spam scams have been quite successful for scammers, but the SEC is apparently increasingly successful in stopping the practice. It's now suspending trading on certain stocks that appear susceptible to pump and dump scams -- and that's more than cut in half the number of complaints its received in the last few months. What still isn't clear, however, is why it's so difficult to track down those responsible for pump and dump scams. You just need to follow the money and look at who bought the stock right before the scam started and who sold out immediately afterwards and you probably have a pretty short list of suspects.

Filed Under: pump and dump, scams, spam
Companies: sec

Pump-And-Dump Stock Spammers Made $20 Million

from the nice-work-if-you-can-get-it dept

Well, we already knew that pump-and-dump stock spam scams worked for the spammers, but we weren't aware of just how well they worked. Apparently a group of pump-and-dump spammers made out to the tune of $20 million before they were caught. Of course, unlike in some cases, these scammers involved the executives of the companies they were hyping up -- though, it's unclear to what extent those executives understood what the scammers were planning to do.

Filed Under: pump and dump, stock spam

Pump-And-Dump Scammers Move From PDF Prospectus To Excel Spreadsheets Touting Stocks

from the does-anyone-click-on-attachments? dept

Last month, we wrote about pump-and-dump stock scammers creating and sending bogus prospectus PDF files to try to trick more people into buying shares. Apparently, they're now moving on to other attachments as well. Specifically, a few spammers are experimenting with sending spreadsheet files. It's not clear from the article if the spreadsheets just include text hyping the stock, or if it actually includes some sort of numerical spreadsheet analysis. The security firm that spotted this spam predicts (not unreasonably) that we'll soon see PowerPoint presentations for stock spam as well. Again, though, it makes you wonder why these stock spammers don't turn all that energy into actually becoming stock analysts. If you're going to go through all that work, why not be legit?

Filed Under: pump and dump, spam