Pump and Dump
Your investment helps boost the value of a stock—at which point the scam artist sells their shares, devaluing your shares.
How it works
These scams are often run out of a boiler room. You’ll receive an email or phone call promoting an incredible once-in-a-lifetime deal on a stock. The scammer promoting the stock also owns a large amount of it. As they sell to more and more investors, the value skyrockets. Once the price hits a peak, the scam artist sells their shares and the value of the stock plummets. They make money and you’re left holding worthless shares.
How to protect yourself
- Check that the individual and firm selling the investment are registered in New Brunswick. Use the National Registration Search Tool.
- Get as much written information as possible about the investment. It should include detail about the risks and costs of the investment, and what you have to do to get your money out.
- If you’re unsure, get a financial professional such as an accountant, lawyer, or a financial advisor to evaluate the investment.
How to report it
If you suspect you are a victim of a pump and dump scam, or attempted pump and dump scam, complete the FCNB Submit a Complaint form.
FCNB administers and enforces legislation in the mortgage brokers, payday lenders, real estate, securities, insurance, pensions, credit unions, trust and loan companies, cooperatives, and a wide range of other consumer legislation. If your complaint relates to an area outside of FCNB’s regulated areas, we may refer you to the appropriate reporting agency or organization.