SINGAPORE – For the first time, securities regulators and law enforcement agencies in Singapore and Hong Kong have teamed up to cripple a cross-border syndicate running pump-and-dump scams.
The syndicate is alleged to be running the scams on the Hong Kong Stock Exchange, by buying up shares and spreading false positive news about certain companies, artificially pumping up its stock prices.
The fake news is spread via social media and messaging applications, causing unwary victims to buy the shares at the inflated prices.
When prices are sufficiently high, the syndicate allegedly dumps the shares by selling the stocks to victims.
The victims are then left holding stocks with plummeted value, and suffer substantial losses while the syndicate members profit.
In a joint release on Thursday (Dec 16), the Singapore Police Force (SPF) and Monetary Authority of Singapore (MAS) said they have launched a joint investigation coordinated with the Hong Kong Securities and Futures Commission and the Hong Kong Police Force.
A woman based in Singapore has been arrested as a suspect linked to the syndicate.
Her passport and about $4.4 million in cash suspected to be proceeds from the scam have been seized.
The MAS and SPF’s Commercial Affairs Department have continued to receive reports of victims falling prey to such scams involving overseas stocks.
“We share relevant information with overseas authorities and will continue to work closely with them to detect and deter such scams,” they said.
“Firm action will be taken against those in Singapore who assist criminal syndicates to perpetrate such scams.”
Members of the public are advised to be wary of stock recommendations offered on social media and messaging applications, and should exercise caution regarding discussions on coordinated trading activities on such platforms, said the MAS and SPF.
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