In today’s fast-moving financial markets, staying informed is one of the best ways to protect your investments. One common scheme targeting individual investors is the pump-and-dump scam – a form of market manipulation that can lead to significant financial losses. To help you stay safe, we've put together some basic information on the pump and dump scam, as well as key tips and red flags to watch for, so you can identify and avoid these deceptive tactics before they impact your portfolio.
What is a “pump and dump” scam?
Fraudsters pick a low-priced, thinly traded stock (often a penny stocks). They:
“Pump” the price up by spreading exaggerated or false claims (like “upcoming merger,” or “exclusive insider info”).
Gain your trust by letting you profit via this news.
Continue to “pump” with new news and ask you to buy more.
As more victims buy in and the price soars, they “dump” their shares.
Once they cash out, the stock crashes — you are left holding near-worthless shares.
Tips to guard yourself against "pump and dump" scams
1. Verify company fundamentals
Before buying, always check:
Official press releases — through trusted sources (Bloomberg, Reuters, the company’s investor relations page).
Audited financials, real business address, and management info.
MAS Investor Alert List
If these are missing or vague, it’s a huge red flag.
2. Be sceptical of hype
Watch for telltale signs:
“Guaranteed to double!” or “Buy before others find out!”
Sudden social media buzz or mass emails/texts about a small stock.
Promotions from unknown “analysts,” newsletters, or influencers.
Remember: real opportunities don’t need spam to promote them.
3. Check out the company, the company news and its trading activity
Check the company’s ownership disclosures.
Verify news through multiple news channels or tools (e,g: TigerAI).
Be cautious of “low-float” stocks. A small number of shares available for trading means even modest buying pressure can drastically move prices
Look for abnormal volume spikes or price surges with no legitimate news.
Use chart to view historical volume.
Be calm, study and verify. Don’t be FOMO. If it’s truly solid opportunity, it will be there.
If You Suspect You Were Targeted:
Stop trading the stock immediately.
Report suspicious promotions or trades to Tiger brokers or MAS.
If you are being scammed and incur financial loss, make police report.
Keep records of all messages, emails, or chat screenshots as evidence.
Whoever can guess correctly, I wish your portfolio is green by the end of market close.
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