Spammers attempt to lure companies that are currently floated on the stock market by promising to increase the share value, and in return request a percentage of this increase.

The targeted emails from spammers instruct recipients to purchase shares with a low value in order to increase the value of previously attained stock owned by the spammers. This method, which is rising steadily in prevalence has become known as “pump-and-dump” scamming.

Research into the new “pump-and-dump” phenomena has shown that those who chose to participate in the proposal set out to them by this new generation of spammers could be set to lose 8% of their initial investment within 48 hours; this is despite claims that a company could increase the value of their share price by 250% or more in a little less than a month. However, the spammers may gain between 5-6% in the stock value of the company that they are attempting to pump.

Sophos, a computer security firm who monitors spam trends, has recently revealed that the “pump-and-dump” style of spam has been growing at an extremely fast rate. Within a year and a half, “pump-and-dump” scamming has become accountable for 15% of all spam sent in emails.

The general format for the emails that “pump-and-dump” scammers circulate often contain attractive offers, such as a no obligation free one-day trial in order to show off the merit of using such a service, demonstrating to a company how potentially effective their actions could prove. However, this is not the only inaccurate part of these increasingly circulated spam emails. These messages are generally made up of relatively incoherent text consisting of poorly spelt and badly punctuated sentences. The spam emails promise to boost the share value of a company and also to provide information regarding the increase in share value of other companies with which they are dealing. This apparently useful information could be used by a company to make further gains by investing money in companies that will receive the same treatment in the short-term future.

Any company that takes up the offer presented to them in the “pump-and-dump” scam will be contravening financial trading rules, and will be guilty of committing fraud in most countries.

Although most individuals will be able to see the nature of these messages as being completely erroneous with little effort, there are fears that small companies could be duped into participating in such a scheme, perhaps unawares of the crimes which they are committing. The best advice to individuals and companies, according to security firms is to ignore such offers, and continue to use a spam filter for incoming messages.