In a classic "pump and dump" scheme, fraudsters drive up the price of a company's stock, typically an unknown microcap or penny stock with little published information available about it. This touting of stocks is done through the use of false and misleading statements typically sent through mass e-mail messages or via posts in online chat rooms. After a while, the fraudsters sell out when the stock's price peaks. Once the fraudsters sell out and quit touting the stock, the share price typically plummets, leaving investors holding worthless or next-to-worthless securities.
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