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Hong Kong exchange pump and dump

Scam Alert: WeChat Or Linkedin Users, Main Target For Hong Kong Stocks Pump And Dump Scams

profileMing Feng

Are You Or Your Loved Ones On WeChat Or Linkedin?

There is a recent scam that is going around which Singaporeans might want to pay more attention to. If you or any of your loved ones are on WeChat or Linkedin (that’s like the majority of Singaporeans), here’s one of the latest scam circulating in Singapore.

Here’s how the scam is being carried out:

  • The scammers will reach out to you through social media platforms such as WeChat and Linkedin.
  • The scammers then text the victims on the pretext of friendship, networking or business opportunities.
  • Upon gaining the trust of their victims, the scammers would then encourage their victims to buy specific shares on the Hong Kong Stock Exchange, promising them guaranteed profits.
  • Should the scammers convince enough victims to buy the mentioned shares, the price of the share increases.
  • The scammers, then, sell their portion of shares and disappear with their profits.
  • This sell-off lead to a dip in share price, higher than the price of which the victim invested.

Source: Singapore Police Force

This scam technique has resulted in numerous Singaporeans losing their investments. Having received more information on this, we decide to inform our readers about this to prevent this incident from happening to our readers and their loved ones.

The highest loss clocked for this scam went up to as high as S$200,000, so let us warn our friends and family members about this.


What To Look Out For?

Source: giphy

Like every scam out there, there are a few tell-tale signs on the legitimacy of whatever they are selling.

The general basis of every scam remains the same, “if something sounds too good to be true, it probably is”.

Source: orangejasminepurpleyam.com

Editor’s Note: Am attaching an image of the quote above at your convenience, to set as your phone’s wallpaper as a good reminder.

Breaking down the scam into various phases, here are some things to take note of.

Connecting With You On Social Media

First of all, for strangers reaching out to you on social media, there is definitely an agenda install for them. Be it sales, scam or even asking you out on a date. Should someone connect with you and indicate that it is out of goodwill and they wish to give you some benefits with no string attached, it sounds too good to be true.

For this current scam, the most active platforms used are:

  • WeChat
  • Linkedin

The group running this scam is usually from China or Hong Kong.

Gaining Your Trust

Here are some tactics that the scammers use to gain your trust:

  • Showing you a photo of their bank account, indicating that they are well to do.
  • Introduced themselves to be an employee of an established company which allow them to gain insights and insider information of a particular company.
  • To get close and gain the trust of their victims, they usually provide their victim with some insider information about certain stock prices.
    When the stock price eventually goes up as the insider information promised, it may leave the victim wanting more. Do take note that such prices may be manipulated on the scammer’s end.

Stocks To Take Note Of

There is also some information on the companies these scammers use to con Singaporeans of their money. They tend to pick penny stocks on the Hong Kong Exchange to lower the barrel of entry for their victims.

Here’s a list of companies shares which the scammers use to scam their victims:

  • Daphne International Holdings Ltd (0210: HKG)
  • Elegance Commercial and Financial Printing Group Ltd (8391: HKG)
  • Eggriculture Foods Ltd (8609: HKG)
  • Mindtell Technology Ltd (8611: HKG)
  • KNT Holdings Ltd (1025: HKG)
  • Classified Group Holdings Ltd (8232: HKG)
  • Metropolis Capital Holdings Ltd (8621: HKG)
  • DLC Asia Ltd (8210: HKG)
  • Nian Nian Ka (3773: HKG)
  • Tianbao Energy (1671: HKG)
  • 21Century Edu (1598: HKG)

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About Ming Feng
A stint in Bloomberg gifted me with a beer belly, which only grew larger when I moved on to become a Professional Trader. Now I turn caffeine into digestible finance-related content.
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