HOW MOST PUMP AND DUMP SCAMS WORK:

* A person sees an investment opportunity on social media

* The post uses the image of a well-known commentator, investor or financial institution to build credibility

* The opportunity is actually fraudulent, generated by the scammers

* The consumer clicks the post and is directed to a messaging platform such as WhatsApp

* A scammer impersonating the expert provides stock recommendations, often on foreign exchanges

* Fake investors, often part of the scammer’s team, post messages about their supposed profits to build credibility and reel the victim in

* The victim buys the recommended shares, causing the share price to rise (scammers often ask for screenshots or proof of purchase)

* The scammers suddenly sell their existing holdings at the inflated price, causing the price to collapse

* The victim is left holding shares worth significantly less than what they paid

WHAT TO DO IF YOU ARE SCAMMED

* Call your bank as soon as you realise it’s a scam

* Seek support through ID Care if you need to recover your identity

* Help others by reporting scams to Scamwatch

* Unfortunately, scammers are often overseas and out of reach of Australian law

* The chances of getting your money back are very low

Source: ASIC

(Australian Associated Press)