ASIC warns of rising pump and dump scams targeting Australian investors

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ASIC warns of pump and dump scams

Highlights

ASIC reports a surge in pump and dump scams using the names and images of prominent financial figures to lure Australian investors via messaging apps.
A recent case highlighted a manipulated share price rising to almost U.S.$11 before collapsing to U.S.$1, demonstrating rapid investor losses from such scams.
Australians lost $2.18 billion to scams in 2025, including $837.7 million from investment scams, prompting ASIC to urge financial institutions to strengthen anti-scam monitoring.

Scam tactics and regulator warning

As reported by ASIC, scammers are increasingly using the names and images of well-known market commentators, economists and financial institutions to lure Australians into WhatsApp and other messaging groups where they are pushed to buy shares.

ASIC says the scheme typically starts with a social media post that appears to promote an investment opportunity through a trusted public figure or brand. After a user clicks through to a messaging platform, a scammer posing as the expert or an assistant provides stock recommendations, often involving shares listed on foreign exchanges, while other accounts in the group claim to have made profits to build credibility.

Consumers then buy the recommended shares, lifting the price, before the scammers sell their own holdings into the inflated market. ASIC Chair Sarah Court says the scams continue to cause substantial harm and warns that legitimate investment opportunities do not come from strangers on messaging apps pressuring people to buy shares.

ASIC Commissioner Alan Kirkland says many victims do not immediately realise they have been scammed because the shares are real and are bought through legitimate brokerage accounts. He says the losses emerge when manipulators dump their holdings and the share price collapses, leaving investors with stock worth far less than they paid.

Investor losses and pressure on financial firms

ASIC says older Australians appear to be a main target, particularly people nearing retirement who may have accumulated savings and are looking for investment opportunities. Kirkland says the scams are becoming harder to detect, including through the use of AI-generated deepfake videos of well-known personalities.

In one recent case cited by the regulator, a share price rose rapidly to almost U.S.$11 before falling to U.S.$1 soon after, illustrating how quickly losses can mount when a manipulated stock unwinds. The pattern differs from many other investment scams because victims are not sending cash directly to criminals, but are instead buying genuine shares whose prices have been artificially inflated.

According to the National Anti-Scam Centre's latest Targeting Scams Report, Australians lost $2.18 billion to scams in 2025, including $837.7 million from investment scams alone. Court says banks and financial service providers have an important responsibility to monitor suspicious transaction patterns linked to investment scams and market manipulation and to help protect customers from harm.

In our earlier article, we covered a New York money-laundering case tied to cyber investment fraud schemes that allegedly routed tens of millions of dollars through shell companies and bank accounts. Prosecutors said the network used social media and messaging apps to build trust, display fake profits, and steer victims into bogus investments before moving the proceeds abroad through a web of accounts.

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