Articles Tagged with Investment Fraud Attorney

Investors Beware: Paid-to-Click Fraud

There’s a new online scam targeting investors. The Securities and Exchange Commission (SEC) has issued an alert to investors to watch out for Paid-to-Click (PTC) fraud. PTC scams involve fraudsters duping investors out of money for purchasing online advertisements.

With Paid-to-Click fraud, investors are targeted by scammers who promise a share of profits for the upfront purchase of ad bundles and packages. Some scams may promise easy financial returns and online advertising space while others simply promise returns in exchange for an upfront fee alone.

Customer Advisory Centers vs. Call Centers

Although they sound similar, customer advisory centers differ from call centers in several important ways. Securities firms and investment broker-dealers typically rely on call centers to handle basic customer service issues and administrative functions. They do not provide investment or trading advice, nor do they earn commissions on trades and deals.

Customer advisory centers, meanwhile, are call centers staffed by securities professionals. They are able to provide trade and investment advice as well as sell securities services.

svEven the most careful and diligent investors can get stuck in an investment fraud scheme without an investment fraud attorney. Florida residents who have been victimized by an investment fraud scheme (i.e., a Ponzi scheme, stock portfolio loss, negligence on the part of your stockbroker or financial adviser) will need a Florida investment fraud attorney, and we at the Savage law firm are here to help.

While it can be distressing to learn that you have lost thousands — if not hundreds of thousands — of dollars as a result of an investment fraud scheme, it should serve as some comfort to know that both state and federal laws protect you, the investor, from negligent, unsuitable, or otherwise illegal behavior by your investment advisers and/or stockbrokers; should you be a victim of such predatory behavior, these same laws also provide that you, the investor, can seek financial remedies against those same financial advisers and stockbrokers.

Of course, it’s never as easy as just asking for your money back, and getting it. The actual process of obtaining restitution for your losses can be a costly legal battle that requires an understanding of complex state and federal laws that most laypeople (i.e., non-lawyers) simply do not have. This is why the assistance of an investment fraud attorney is invaluable.

logo-squareA pump and dump scheme is a form of investment fraud where people artificially inflate the price of stock they own, and once it has reached a certain price they will sell it before the price goes down again.  The perpetrators of such a scheme raise the stock price by creating synthetic hype around the stock. At one time this was normally done by cold calling. An individual claiming to be an expert stockbroker might randomly call people to inform them of a stock that was virtually guaranteed to go up, and that failing to invest in it would mean missing out on perhaps thousands of dollars. One variant of cold calls would be to leave a message on somebody’s answering machine or voice mail. The message is worded in such a manner that the victim believes the caller had reached the wrong number, and now has access to valuable inside information which must be acted on very quickly.
These days such fraud is more often committed online. The Internet allows for far more potential victims to be reached, over a shorter period of time. Messages might be posted on bulletin boards advising visitors to purchase the next hot stock. If enough people take the bait, the stock price will go up. Later posts might point out that the price of the stock in question has, in fact, become more expensive, which leads to even more shares being sold.
At some point the perpetrators of the scheme will sell, or dump, all of the shares. This is generally done when they are satisfied with the profits that will result. When a large number of shares are dumped the stock price plummets, usually to a price that is less than what the victims of the scheme paid, resulting in monetary losses for them. Pump and dump schemes generally target micro- and small-cap stocks, because they are most easily manipulated. These stocks do not have a great number of shares being traded, and therefore their price can be influenced by a smaller number of trades. If you have been the victim of a pump and dump scheme, please contact us today to discuss your options.

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