I doubt you have missed the news about the oil spill mess in the Gulf of Mexico. The scammers have clearly noticed and sense an opportunity to make a quick buck.
Some companies may issue press releases, or send unsolicited faxes or spam emails that might include:
- Claims to have products or technologies that are effective in remediating oil spills or restoring the eco-system
- Mention of contracts or expected contracts with BP, formerly British Petroleum, that will aid the cleanup effort
- Claims that the company is providing technical assistance or expertise to BP or to U.S. government agencies such as the Coast Guard or the Environmental Protection Agency
One of the first identified scam enforcement actions, the SEC suspended the trading in ACT Clean Technologies.
The Commission temporarily suspended trading in the securities of ACT because of questions that have been raised about the accuracy and adequacy of publicly disseminated information concerning, among other things: (1) British Petroleum’s purported expression of interest in using a so-called oil fluidizer technology purportedly licensed to ACT’s wholly-owned subsidiary, American Petroleum Solutions, Inc., for use in cleanup operations in the Gulf of Mexico, and its purported request that field tests be conducted on the oil fluidizer technology; and (2) the purported results of field tests finding that the oil fluidizers are effective for use in clean up efforts in the Gulf of Mexico.
Many of these “investment opportunities” are classic pump-and-dump schemes. Early investors pay people to generate publicity intended to increase demand for company stock and drive up the stock price. They use spam emails, investor bulletin boards, blogs, Twitter and any of the myriad of social networking platforms. When prices rise, the insiders or third party scammers sell their shares and let the price drop.
Other stocks involved are MOP Environmental Solutions and Green Bridge Industries.
Complaints can be filed on FINRA’s website or on the SEC’s website. You can also call the National Center for Disaster Fraud’s special oil-spill hotline if you suspect an oil spill scam: 1-866-720-5721.
The Financial Times is reporting that the assets of BP executives are being used instead of the typical dead banker emails from Nigeria.
I am the private solicitor for Mr Tony Hayward, the esteemed Chairman and Chief executive of British Petroleum. My client has various personal and family related holdings of BP stock and options. Due to his faithful long standing service to BP the total value of his holdings amounts to in excess of 100m pounds sterling. Mr Heywood is a British citizen but it has been my sorrowful duty to advise him that his personal and family wealth is at great risk of being wrongfully confiscated by US authorities acting extra-territorially under special powers authorised by the US government and with the secret consent of a supine UK political and legal establishment.
Sources:
- SEC Announcement – Oil Spill Stock Scams–Don’t Get Cleaned Out by False Cleanup Claims
- SEC Release No. 62116 Suspending Trading in ACT Clean Technologies, Inc.
- BP Oil Spill Spawns Slick Stock Scams by M.P. McQueen in the Wall Street Journal
- A Further Indignity for BP by Neil Hume for ft.com/Alphaville
- FBI Press Release – National Center for Disaster Fraud to Coordinate Gulf of Mexico Oil Spill Fraud Complaints
- Don’t pump cash into ‘oil spill’ penny stocks By Chuck Jaffe in the Boston Herald
Way to be about 12 days late to the “Watch out for oil spill scams” flurry of articles that all regurgitate the same thing. At least 7 days ago I wouldnt fault them for including MOPN in their analysis. But since announcing that an order has been received from BP, MOPN is actually a player in the clean up. Hows that fact checker workin for ya?
Thanks for the update. MOPN did get a purchase order for booms: http://www.spe.org/jpt/2010/06/biodegradable-booms-to-help-gom-spill-clean-up/
I updated the post.
That’s what I get for letting post sit in draft for so long.
I see that you have cross out MOPN and GRBG as a company that is not part of the scam. Aren’t you liable though for not making your report accurate? You can be sued by investors like myself if you have no proof and writing an article about companies that were not part of the scam and then investors like myself read your report, and more than that the company can sue you as well. Any feedback on that issue?
Sued? Yes. It’s easy to file a lawsuit, regardless of whether or not it has any merit.
Would they win the case? Probably not. There is no merit to the claim. Libel generally requires some malice. There was no malice in my article. MOPN and GRBG were implicated and identified as potential problems.
The problem for those companies is whether the stock movement happened before a public announcement about a major transaction which could have insider trading implications.
Sounds fair enough.I do think you were fair to describe the companies here. Due diligence is always the key for investors like myself. Thanks for replying.