FBI Alerts to "Ramp-and-Dump" Stock Fraud Disguised as "Investment Clubs" on Social Media and Messaging Apps

The FBI has issued a public alert on the rise of "ramp-and-dump" stock manipulation schemes disguised as an online “investment club.” These operations often lure victims through online engagement, social media advertisements, and messaging apps, promoting so-called exclusive stock tips and coordinated investment opportunities.

According to the FBI, perpetrators may pose as reputable analysts or brokerage firms to build trust. Victims are directed to private messaging groups, some populated with bots or fake profiles, where they’re encouraged to buy shares of low-priced stocks over weeks or months. Unbeknownst to them, the scammers already control large volumes of the stock and coordinate efforts to inflate its price ("ramp up").

Once inflated, the fraudsters sell off their holdings ("dump") for a profit, triggering a price collapse that leaves unwitting investors facing steep losses.

The FBI reported a 300% increase so far in 2025in victim complaints related to these schemes compared to the previous year.

Warning Signs of “Ramp-and-Dump” Fraud

• Unsolicited investment tips received via “accidental” messages or social media ads linking to online “investment clubs”
• Impersonation of well-known financial advisors or wealth managers offering exclusive stock tips through these online “clubs”
• Pressure to act quickly on market-moving events, such as a company breakthrough, new technology, or government approval
• Aggressive promotion of low-priced stocks with guarantees of dramatic price increases, and to cover any losses

The FBI urges the public to remain cautious, especially when asked to share personal information or financial access. Such details may be misused to open accounts and facilitate market manipulation activity.

Last September, the Dutch Authority for the Financial Markets (AFM) also issued a warning about “pump-and-dump” schemes involving cryptocurrency-related market manipulation. More recently, in June, four individuals pleaded guilty to criminal charges brought by the Australian Securities and Investments Commission (ASIC) last July for orchestrating a coordinated “pump-and-dump” share prices scheme.