Stock spam

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Under stock spam is defined as the mass sending of e-mails ( spam ) with advertising for a share , to drive the price up. These emails usually advertise shares in a penny stock . The mailer predicts a high price increase because the company is said to be releasing “good news” (new invention, new sales market, etc.) shortly. Most of the time the statements are declared as inside knowledge .

The sender of the mail buys the shares before sending them, which sometimes cost less than 10 cents. Stimulated by the advertising, the trading volume increases and, as a result, the share price increases . Doubling or even multiplying the market value is nothing unusual.

However, as soon as some shareholders - usually also the advertisers - sell their shares, the price falls sharply again. In some cases, exchange rates are even achieved that are below the rate before the spam was sent. Shareholders who did not jump out in time are left with virtually worthless papers.

A distinction must be made between two options for stock spam:

  • On the one hand, foreign stocks are advertised that the investor can never sell again, as these are only advertised in order to sell them themselves. One also speaks of "unloading". In this case, the spammer generates all of the revenue.
  • The other type of stock spam is recommending stocks, mostly domestic penny stocks. Here the spammer has previously collected shares and then gives the buy recommendation. Here the spammer profits if he sells his shares at a higher price after the price increase.

According to the Federal Financial Supervisory Authority , the phenomenon of share tips is old, only the medium of share spam is new.

If in both cases this conflict of interests is not effectively pointed out and the share rises or falls due to the buy recommendation, this is a criminal offense. If the price does not change, it is an administrative offense.

Sending stock spam constitutes a competition violation (Section 7 UWG , harassing advertising).

See also

swell

  • Ordinance specifying the ban on market manipulation (Market Manipulation Concretization Ordinance - MaKonV, repealed from January 3, 2018)

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