Exclusive “investment clubs” on social media or messaging apps often are outright scams designed to lure investors into pump-and-dump stock manipulation, the Federal Bureau of Investigation (FBI) has warned. The FBI is urging victims to provide more details about any incidents.
The FBI Internet Crime Complaint Center (IC3) saw a sharp increase in complaints referencing investment club fraud schemes or pump-and-dump stock manipulation schemes over the past year.
The FBI’s warning is clear: beware of secret groups, clubs, or other online engagements with cybercriminals targeting investors on social media and messaging apps. Scammers and their bots often buy ads and send messages promoting “investment clubs,” which are often fake accounts.
“These promotions typically direct victims to secure messaging apps where the group operates. To appear credible, perpetrators may impersonate legitimate brokerage firms or well-known stock analysts,” the FBI explains.
Scammers pitch potential investors with fake opportunities and encourage members to purchase specific shares over a period of time, e.g., several weeks or months.
What they don’t tell is that scammers secretly control a large volume of these stocks, which are usually low-priced. Their goal is to coordinate efforts to temporarily inflate the price with the victim’s money.
“Once the price is artificially elevated, the criminals sell off (dump) their shares at a profit, leaving unsuspecting investors with significant losses as the stock value collapses,” the FBI said in a public service announcement.
Pump-and-dump complaints surged 300% in 2025 compared to 2024. The FBI urges investors who suspect they’ve been victimized by investment fraud to report the incident as soon as possible.
Various types of investment fraud are typically the most costly to victims. Last year, reported investment fraud losses reached $6.6 billion out of a total of $16.6 billion in internet crime losses.
The FBI shared a few tips for investors to protect themselves from a potential involvement in pump-and-dump schemes. Recognize the following indicators:
- Scammers disseminate unsolicited investment tips received via “accidental” text messages or social media advertisements linking to online investment clubs, often hosted on secure messaging apps.
- They mimic well-known financial advisors or wealth managers and offer “exclusive stock recommendations” through fraudulent online clubs.
- Fraudsters pressure to act quickly based on a supposed market-moving event, such as a company breakthrough, new technology, or government approval.
- Faux advisers send urgent pitches to purchase low-priced stocks in new or emerging companies. They often promise dramatic price increases or guarantees to cover any investor losses.
Anyone requesting personal information or access to financial accounts is a red flag. Be wary of financial benefit offers in exchange for sharing personal data or opening an account. The FBI warns that fraudsters can then use stolen information to open an account and engage in manipulative activity.
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