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SFC and Police warn investors about social media scams

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The Securities and Futures Commission (SFC) today alerted the public about online investment scams in a short video produced jointly with the Anti-Deception Coordination Centre (ADCC) (Note 1) of the Hong Kong Police Force (HKP).

In the video, investors are warned to beware of fraudsters who set up investment groups on social media platforms and claim to offer stock tips or inside information. In some cases, well-known investment advisors and market commentators have been impersonated as part of these scams.

The video features a dramatisation of a typical “ramp and dump” scheme, which is a form of stock market manipulation. Fraudsters “ramp” up the price of a stock and use social media to lure investors to buy at an artificially high price. The fraudsters then sell or “dump” the stock. Most of the time, the investors do not know the true identities of the people who lured them into the trap.

“One of our top priorities for the year is to crack down on ramp and dump scams and other types of market manipulation conducted through popular social media platforms,” said Mr Thomas Atkinson, the SFC’s Executive Director of Enforcement. “Together, the SFC and ADCC are conducting this publicity campaign to raise public awareness about how these scams work. The SFC is also working closely with the Hong Kong Police to tackle syndicate-based ramp and dump scams.”

The video was posted today on the Facebook pages of the SFC and the HKP (Note 2).

Notes:

  1. The ADCC was set up in 2017 with a view to stepping up actions against deception and enhancing public awareness of various kinds of scams, by consolidating all the efforts of the HKP and relevant stakeholders in fighting and preventing crimes.
  2. A trailer for the new video was posted on the SFC and HKP Facebook pages on 8 February.

This news item was originally published by the Securities and Futures Commission (SFC HK). For more information, see the Source Link.

Regulator Information

Abbreviation: SFC
Jurisdiction: Hong Kong

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