Discover the signs and recover from pump and dump fraud

Scammers thrive on hype and deception, preying on investors before vanishing with their funds. If you've been a victim, don’t lose hope—WRS is here to help you reclaim what’s rightfully yours.

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Pump and dump scams

What is a pump and dump scam? 

Pump and dump scams are when influencers, or people who invest, create hype around a stock or cryptocurrency by fake claims or exaggerated statements.

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    How does a pump and dump scam start?

    Firstly, there’s initial pumping—this is where scammers choose or create a low-market-cap stock that’s easy to manipulate. Then they create excitement, spreading fake news and social media hype to drive up demand. More investors buy in, pushing the price even higher.

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    What happens next? 

    Once the price peaks, scammers “dump” their holdings, selling off the stock at its inflated price. This causes the value to suddenly drop, leaving investors stuck with worthless stocks and significant financial losses.

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    What happens after?

    After scammers dump the holdings, the stock’s value typically crashes back down to its original level or even lower. The fraudsters often walk away with substantial profits, leaving regular investors to bear the financial losses. 

How to spot pump and dump scams

Grand promises and price spikes

Be wary of investment advice or “hot tips” that promise quick, high returns. If a stock’s value is soaring without clear reasons—like major news or partnerships—it could also be a red flag.

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Putting pressure on you

Scammers often rush you into investing by making it seem like a once-in-a-lifetime opportunity. Legitimate investments don’t rely on high-pressure tactics. If you're feeling pushed to act fast, take a step back.

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Do your due diligence

Always research any investment thoroughly. Look for credible sources of information and avoid relying solely on social media or anonymous tips. Be cautious of potential investment with little trading history and ensure you use trusted and regulated platforms. 

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Why WRS?

Supporting you is our priority. That’s why we provide personalised plans and care around the clock to our clients. 

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Meet the specialists by your side

Recovering over £45,000,000 for clients like you

Over the past 3 years, we’ve recovered more than £45,000,000 for our clients. It’s thanks to our team of solicitors and recovery claim specialists who trace and recover the investments you’ve lost from scams. Plus, we offer a no-win, no-fee service. You won’t pay a thing unless we recover your money. 

 

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Join satisfied clients who’ve recovered their lost funds with WRS.

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Call on us for guidance and support 

Falling victim to fraud can be overwhelming and distressing. You deserve expert guidance and support every step of the way. That’s what we’re here for.

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Pump and Dump Scam FAQs 

  • Are pump and dump scams linked to boiler room fraud?

    Both scams involve pressuring individuals into investments with misleading claims. In pump and dump schemes, scammers artificially inflate a stock’s price before selling off their shares at a profit, leaving investors with worthless holdings.  

    However, boiler room fraud typically involves persistent cold-calling to sell fake or overvalued stocks. While both rely on deception and high-pressure tactics, boiler room scams focus on direct sales, whereas pump and dump scams manipulate market hype. 

  • What is the difference between a crypto rug pull scam and a pump and dump scam?

    Both scams deceive investors, but rug pulls are exclusive to cryptocurrency. In a rug pull, developers create a crypto project, attract investors, then suddenly withdraw all funds and disappear. Pump and dump scams can involve any financial investment—crypto, stocks, or others—by inflating prices before selling off, which causes the market to crash. While rug pulls focus on outright theft, pump and dump scams rely on market manipulation. 

     

  • Is a pump and dump scam illegal?

    Yes, pump and dump scams are illegal because they manipulate stock prices for fraudulent gains. Scammers promote a potential investment —often with false claims—and invest heavily to inflate its value. This attracts more investors, driving prices up.   

    Once high enough, scammers sell their holdings, causing a sharp price drop and leaving others with losses. These schemes often involve multiple fraudsters working together to maximise profits. 

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