The Tribune

EDITOR, The Tribune,

To all the folks across the world on this mailing list I wish you a belated Merry Christmas and a Happy, safe, and prosperous New Year.

During this vacation, and with very little to do, I scrolled the computer for information on certain investment opportunities. I came across an incident in South America where a woman formed a company, and told the public that she had discovered a mine where there was gold. She failed to say that there was not enough gold there to make the mining of it economically viable.

When forming the company she gave herself millions of share options priced at extremely low prices. She made sure that important people that could influence decision makers, and the public, were given the same share options.

To the unsuspecting investor this seemed to be a great opportunity. They bought stocks and the price went up. The lady then sold her stock options at the higher price, bailed out and left the unsuspecting investor holding the bag.

This seemed to me to be illegal and so I phoned a friend in South America who dealt in stocks and asked her to explain this all to me. She said, that’s called “Pump and Dump”. In most countries it’s illegal, but she said, “Look it up. It can be Googled”.

So I did and here is what I found: “Pump and dump (P&D) is a form of securities fraud that involves artificially inflating the price of an owned stock through false and misleading positive statements in order to sell cheaply purchased stock at a higher price. Once the operators of the scheme ‘dump’ (sell) their overvalued shares, the price falls and investors lose their money. This is most common with small cap cryptocurrencies and very small corporations, i.e. ‘microcaps’.”

It went on to say that “while fraudsters in the past relied on cold calls, the Internet now offers a cheaper and easier way of reaching large numbers of potential investors through spam e-mail, bad data, social media and false information.”

I read this and was shocked to know that these people existed in the world. But it is good to have a few days off of work to keep up to date on what’s happening around you.

Have a Happy New Year and stay safe, wear a mask and practise social distancing.

PIERRE V. L. DUPUCH

Nassau.

December 30, 2020