Corporate Securities

Cheating the Algorithm: The New 'Pump and Dump' Fraud

, New York Law Journal

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In his Corporate Securities column, John C. Coffee Jr. writes: Old frauds never die. Nor do they fade away. Rather, they mutate and morph into new configurations in response to new opportunities (which new technologies usually create). Thus, the traditional boiler room "pump and dump" scheme was a product of the widespread adoption of the telephone, which allowed high pressure salesman to reach hundreds of gullible customers in a day. Today, an analogous new technological development is inviting new forms of fraud.

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