FINRA issued an investor alert yesterday, titled Messaging Apps Are Latest Platform for Delivering Pump-and-Dump Schemes. In the alert, FINRA cautions investors against stock promotions sent through increasingly popular messaging apps, including WhatsApp.

Lately, users of WhatsApp were inundated with test messages promoting the stock of Avra, Inc. These text messages seemed to be sent from people at large brokerage firms and stated that Avra was “going to double in the next few days.”

“Scammers keep up with the times. If you are using a messaging app and receive a tout claiming that a stock is poised for explosive growth, don’t respond—just delete,” said Gerri Walsh, FINRA’s Senior Vice President for Investor Education.

Scams such as these are simply variations on the classic pump-and-dump scheme, where people spam potential investors to tout a particular stock. In this particular case, they use the mass message feature of messaging apps. The subsequent purchases of the stock will pump up the price, until the people who originally touted the stock dump their shares by selling them at a peak. Ultimately, investors lose their money or are left with worthless, or practically worthless, stock.

If you or someone you know has lost money as a result of an investment or Ponzi scheme, please contact Richard Frankowski at 888-741-7503 to discuss your potential legal remedies or complete the contact form.