The penny stock market isn’t what most uninformed people think it is. Below is an explanation of how a real pump and dump is orchestrated. Now for the uninformed penny stock investor this is really bad news. Most of these people will end up getting caught in a pump and dump and lose everything. For traders like myself pump and dumps lead to huge profits if you learn the way the game is played.
How the scammers operate:
1) First they create a business with a forward looking business plan using some nominee CEO
2) Next they find a dirty attorney to provide the legal opinion for the future insider enrichment scheme and a dirty accountant to “cook thew books”.
3) Then they submit an S-1 filing with a fake business plan to the SEC registering some shares for sale to a group of nominees usually for around between $.001 and $.01 per share.
4) After obtaining public company status from the SEC, they then start working on how insiders can dump their S-1 shares into the public market for huge profits.
5) After this they must set-up anonymous offshore accounts in corporate EGO’s to hold their free trading stock.
6) Then they deposit shares with a dirty offshore broker who will clear certificates using its in house account so they can be easily dumped on the unsuspecting market.
7) They they change their name, do a reverse merger or an acquisition which coincides with a large forward split so they can build the investor relations campaign around the corporate changes and at the same time increase the shares held by the insiders.
8) Next the crooked attorney sends in an application for the name change and forward split to the regulators (FINRA). Thanks to the large forward split insiders now own millions and millions of free trading stock that cost them fractions of a penny to acquire.
9) Next they find a stock promoter with a quality list to do a pump up the price of the stock through their market manipulation tactics.
10) And finally they dump the super cheap free trading shares into the market earning huge profits while the unsuspecting investors suffer huge losses.
Yes the penny stock market is rigged, but that means nothing as long as you play the game right.
You can make thousands of dollars when you understand how the market really works. To get going just click here and try things out risk free.
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