By FARA AISYAH / Graphic By TMR
SECURITIES Commission Malaysia (SC) has issued a warning to investors over the increased use of blogs, forums and social media platforms to spread false and misleading information on certain companies in order to perpetrate “pump and dump” schemes.
The statutory body said the perpetrators would usually accumulate shares at lower prices before posting positive sentiments about the companies, with the intention to spur interest in the shares in order to drive up their prices.
“When unsuspecting investors buy the shares, it gives the perpetrators an opportunity to sell the shares they hold at a profit.
“Investors who have bought shares at the inflated price will suffer losses when the hype eases,” read a statement by SC yesterday.
The SC and Bursa Malaysia recently identified a blog, Bonescythe Stock Watch, which was found to have published various articles that contained statements and forecasts that were misleading and deceptive, which is an offence under Section 178 of the Capital Markets and Services Act 2007.