Pssst! Bogus Hot Stock Tips, Via Fax
Pump-and-dumpers want you to believe that you've lucked into a sure thing
By Joan Caplin

(MONEY Magazine) – In December a lot of people received a fax addressed to a fictional Dr. Mitchel from Chris, his equally fictional financial planner. Chris recommended a few small-cap stocks (Infinium Labs, AVL Global, Soleil Film), adding an oh-so-casual postscript reminding Dr. Mitchel that he'd already given him four wins in a row.

Fax recipients were supposed to think they'd gotten a hot tip by mistake, then run out to buy the stocks. It's a classic pump-and-dump scam in which perps tout thinly traded and thus easily manipulated stocks to drive up their price. The scammers rush to sell for a quick profit. Infinium's price, for instance, doubled during the week after the fax. (All three companies deny knowledge of the faxes.) If you suspect a pump-and-dump scam, contact the Securities and Exchange Commission at enforcement or 800-732-0330. —JOAN CAPLIN