[ad_1]
The group warns that bad actors are posing as RIAs online and pitching investments through encrypted group chats.
The Financial Industry Regulatory Authority has announced a “significant spike” in investor complaints about recommendations by fraudulent “investment groups” promoted through social media channels.
A complaint received by FINRA and posted on social media describes “malicious actors posing as registered investment advisors who initially advertised ‘Equity Investment Groups’ on Instagram and other social media channels. , then transitioned to an encrypted group chat on WhatsApp to communicate with interested investors and pitch investments.”
Since November, FINRA said it has received “more than a dozen complaints from investors alleging losses totaling millions of dollars regarding this threat.”
As with other broker scams, FINRA says: “The bad actors falsely claim to be registered professionals and, in several recent cases, fraudulently claim relationships with high-profile public figures and others in the investment industry, people not involved in the scheme. There is likely to be” “
According to FINRA, fraudsters “also create false personas using the names and other publicly available details of registered investment professionals with impeccable disciplinary records.” says. They then misuse this information to establish their legitimacy, unbeknownst to the actual investment professionals being impersonated. ”
According to FINRA, scammers “first encourage investment in well-known, actively traded stocks, and then, through ongoing conversations on private chat platforms, lure targets into investing in low-priced/low-volume U.S. stocks.” Move to investment. Hong Kong listed stocks.”
After that, the investor is instructed to “open an account with a specific broker-dealer,” and is guided as to “which securities to purchase, in what amount, when, and at what price.” In effect, the investor Unknowingly, they end up manipulating the price of securities. . At some point, investors will no longer be able to sell, and security prices will inevitably collapse,” FINRA said.
Scammers try to convince investors to transfer as much money as possible from other banks or brokerage accounts.
“When investors report losses, the scammers promise to ‘get their money back’ if the investors can transfer more funds to their accounts,” FINRA said.
FINRA warns investors to be “particularly wary of unsolicited messages and social media promoting investment opportunities.”
Use FINRA BrokerCheck to “verify whether a promoter is a registered investment professional and verify that the person’s and firm’s name, address, or place of business match independent research.” The organization advises.
[ad_2]
Source link
