share pump and dump scheme|what is pump and dump scheme|pump and dump crypto|pump and dump meaning|pump and dump scheme definition:Securities and Exchange Board of India (SEBI) on Thursday clamped down actor Arshad Warsi and 45 other people on doing Share Pump & Dump through youtube. Further, the market regulator has barred them from further accessing the markets for one year.Interestingly, Bollywood actor Arshad Warsi and his wife Maria Goretti Warsi have been penalised in relation to the case, where a nexus of players, are accused of making illegal gains worth Rs 41.85 crore.
SEBI on Thursday has taken strict action in the share-rigging case in two companies, namely Sadhna Broadcast and Sharpline Broadcast. The capital markets regulator has issued an impounding order in the Sadhna Broadcast share rigging case, whereas it has issued an interim order in the Sadhna Broadcast share manipulation case.
According to the market regulator’s calculation, Warsi made a profit of Rs 29.43 lakh while his wife bagged Rs 37.56 lakh. SEBI has directed the impounding and retaining of profits made by the actor couple as well as other accused in the case. These gains were made between April 27 to September 30 last year.
pump and dump scheme
Orders passed by Ananth Narayan, whole-time member at market regulator Sebi, in two recent cases, reveal the modus operandi of people operating ‘pump and dump’ schemes on YouTube. Mint explains how these schemes work and how you can protect yourself.
In a pump and dump scheme, fraudsters typically spread false or misleading information to create a buying frenzy that will “pump” up the price of a stock and then “dump” shares of the stock by selling their own shares at the inflated price. Once the fraudsters dump their shares and stop hyping the stock, the stock price typically falls and investors lose money.
How does ‘pump and dump’ work?
The manipulator starts a YouTube or Instagram channel on the stock market. Huge sums are spent on promotions to increase the reach of the channel. In the cases of Sadhna Broadcast Ltd and Sharpline Broadcast Ltd, an amount of ₹4.72 crore was spent to promote channels with names like Moneywise, The Advisor, Midcap Calls and Profit Maker. Then, false claims are made about the stock (pump). For instance, in the case of Sharpline, claims around the Adani group acquiring the company were floated. Once unsuspecting investors purchase the stock, the manipulators sell it (dump).
Bollywood actor Arshad Warsi and his wife Maria Goretti Warsi have also been penalised in relation to the case, where a nexus of players, are accused of making illegal gains worth Rs 41.85 crore.
According to the market regulator’s calculation, Warsi made a profit of Rs 29.43 lakh while his wife bagged Rs 37.56 lakh. Sebi has directed the impounding and retaining of profits made by the actor couple as well as other accused in the case. These gains were made between April 27 to September 30 last year.
Further, the market regulator has barred them from further accessing the markets. The couple, along with others named in the case, have been directed to deposit the impounded amount in a scheduled bank in 15 days with a lien created in favour of Sebi. They have also been directed “not to dispose of or alienate any assets, whether movable or immovable or create any interest or charge on any of such assets held in their name”.
How to do a pump and dump scheme
In a pump and dump scheme, fraudsters typically spread false or misleading information to create a buying frenzy that will “pump” up the price of a stock and then “dump” shares of the stock by selling their own shares at the inflated price
What is the meaning of pump-and-dump scheme?
In a pump and dump scheme, fraudsters typically spread false or misleading information to create a buying frenzy that will “pump” up the price of a stock and then “dump” shares of the stock by selling their own shares at the inflated price.
What is pump-and-dump stock example?
A pump-and-dump scheme usually goes like this: a group of insiders plans to buy a particular stock, like a penny stock, which are riskier types of equities. The insiders then spread false or misleading information about the company to increase the demand for the stock and drive up the price.
How do you identify pump-and-dump schemes?
You can verify this by looking at the stock in social media to see what people are writing about. If you see elevated social media activity, then this is a sign of a pump and dump scheme.