ASIC accused four people, Involved in Pump & Dump Scheme

In the Australian Securities & Investments Commission (ASIC) investigation, four people have been charged criminally for allegedly participating in an organized scheme to artificially raise Australian stock values before selling them at inflated prices.

According to ASIC, the defendants formed a private group on the Telegram app where they discussed and selected penny stocks to announce to the public Telegram group named the ‘ASX Pump and Dump Group.’

ASIC Chair Joe Longo said that market manipulation is illegal. Pump and dump schemes are a form of financial fraud, eroding investor wealth, and threatening the integrity of our markets and potentially the Australian economy more broadly. ‘Upholding the integrity of Australia’s financial markets is a priority for ASIC.

‘ASIC monitors the cleanliness of our markets, and we take decisive action to disrupt activities that may impact cleanliness. This is why we took the action of entering social media forums and posting directly to issue warnings to members that their actions may be in breach of the law. Coordinated attempts to manipulate the market is a criminal offence.’

Syed Yusuf, Larissa Quinlan, Emma Summer, and Kurt Stuart were charged at Downing Centre Local Court with conspiracy to commit market manipulation and dishonest trading to artificially raise the price of Australian shares before dumping them. They face a possible penalty of 15 years in prison and a fine of more than $1 million for market manipulation.

Telegram, WhatsApp and Discord Targeted by Scammers

Although Facebook has been more effective in targeting traders compared to Telegram, over 60% of individuals on Telegram who were involved in trading ended up losing money, according to a joint study conducted by Finance Magnates and FXStreet several months ago.

While the proportion of scam victims losing money is similar on both Telegram and WhatsApp, Telegram sees more traders targeted due to its numerous active trading channels and groups.

Telegram has also gained popularity among retail FX/CFDs and cryptocurrency traders who convene to discuss strategies, share trading signals, and navigate market fluctuations together. The platform has become infamous for hosting pump-and-dump schemes, where influencers promote low-volume assets to drive up prices before selling off their stakes at peak values.

Turning to ASIC, since the initiation of its capability to shut down scam websites in July 2023, nearly 3,500 fraudulent investment sites have been shut down. This effort represents a significant advance in shielding Australians from online investment scams.

WikiFX got such complaints

WikiFX also reported cases of scammers stealing people's money using Telegram. A user wrote a complaint on WikiFX.

“They're scammers. They have 2 different Telegram groups. One has 8,000 subscribers and another one has around 800 subscribers. They are fake profiles all controlled by the same company. They show several screenshots of deposits and withdrawals, all are false. They aren't real people. The profiles are controlled by the company. Be careful. They pay you when your investment is small, then when you get confident (reading so many good reviews from the fake Telegram Profiles) then they ask you to pay them more money in order to unblock your withdrawals.”

In another instance, the victim claimed that he was also duped by the Telegram group.

“I came across WiseMarket through a Facebook ad for JB Indicator on October 27, 2022. Following this, I joined the JB Indicator Telegram group, where JB himself shared insights and trading signals. While I initially profited from WiseMarket, I encountered an issue with my withdrawal. I can't withdraw my funds even though my status is ”approved.“ This situation is concerning and serves as a warning to others. I'm sharing this to prevent others from becoming victims of similar situations. Please exercise caution when dealing with WiseMarket.”

About ASIC

ASIC is Australias corporate, markets, and financial services regulator.

ASIC's key role is to:

· maintain, facilitate, and improve the performance of the financial system and entities in it

· . promote confident and informed participation by investors and consumers in the financial system

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