The Italian Securities Commission (Consob) published a new investor warning about “pump and dump” schemes that manipulate market prices through investment tips circulated on informal channels such as social media and messaging apps, after receiving numerous complaints from defrauded retail investors. Consob described fraudsters posing as analysts, financial operators or even prominent Consob representatives to promote purchases of low-priced “penny stocks”, often shares of small Chinese or US companies listed on Nasdaq, with promises of exceptional short-term returns. The scheme involves organisers who already hold significant positions coordinating buying through WhatsApp groups, sometimes requesting screenshots as proof of trades, to inflate prices before selling en masse and triggering sharp price falls that leave participants with heavy losses. Consob noted that similar pump and dump dynamics can also occur in crypto-asset trading, highlighted common warning signs such as unsolicited messages, invitations to join investment groups, pressure to act quickly, and requests for personal data or screenshots, and stressed that schemes involving securities not listed on European Union markets can leave investors without EU market abuse protections; it also warned that disseminating false or misleading communications may carry regulatory and criminal consequences in the relevant jurisdictions.

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