Call Now For a Free Consultation:
(614) 532-4576
Nationwide Representation

"Pump and Dump" Investment Scams Tied to BP Oil Spill

Federal officials are warning investors to be wary of pump-and-dump schemes in the aftermath of the BP oil spill, according to The Sacramento Bee. These scams are relatively common after a natural or environmental disaster, and several popped up in the aftermath of Hurricane Katrina. In a pump-and-dump scheme, a company goes to great lengths to promote its ability to aid in recovery and rebuilding. When new investors pour in, company officials benefit from the inflated share prices by cashing out. Prices then plummet, and investors are left holding over-inflated stock. Last week, out of concern for the public interest, the SEC suspended trading in ACT Clean Technologies stock, which is currently listed on the Pink Sheets stock exchange. Trading will resume after June 8, according to Daily Finance. The SEC's statement questions the accuracy of ACT's assertions that: 1) BP has expressed interest in using technology owned by an ACT subsidiary to assist in cleaning up the Gulf oil spill, 2) field tests were requested by BP, and 3) the oil fluidizer technology owned by ACT's subsidiary has been shown in field tests to be an effective agent for clean up efforts. ACT is the first company to be reprimanded by the SEC for actions involving the BP oil spill, but it may not be the last. FINRA vice president for investor education, John Gannon, was quoted in a June 1 The Sacramento Bee article as saying: "We're never surprised by these scams."

The information contained in The Firm’s posts on its blog, fraud alerts, investigations or elsewhere on the site is based upon information obtained from other sources including, but not limited to, news outlets and federal, state, and regulatory agency filings. All suspects and subjects of postings herein are presumed innocent until proven guilty in a court of law or administrative action and any and all crimes are alleged until a court or regulatory agency finds otherwise .

Share This Story
If you found the information provided by this article useful, consider sharing to your social media channels to help others in their search for reliable resources.
Consult with Our Legal Team
There is never a cost associated with a consultation
Atlanta Office

945 East Paces Ferry Road, Suite 2275
Atlanta, GA 30326
Columbus Office

614-224-6000
305 W. Nationwide Blvd
Columbus, OH 43215
Meyer Wilson
New Orleans Office

900 Camp Street 
Suite 337
New Orleans, LA 70130
Los Angeles Office

310-905-8688
2029 Century Park East,
Suite 400N
Los Angeles, CA 90067
Cleveland Office

216-600-1355
4781 Richmond Rd.
Suite 400
Warrensville Heights, OH 44128
Bloomfield Hills Office

248-817-8214
41000 Woodward Ave.,
Suite 350
Bloomfield Hills, MI 48304
Quick Links
The information contained in this Website is provided for informational purposes only, and should not be construed as legal advice on any subject matter. No recipients of content from this site, clients or otherwise, should act or refrain from acting on the basis of any content included in the site without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from an attorney licensed in the recipient's state. Read More
The information contained in this Website is provided for informational purposes only, and should not be construed as legal advice on any subject matter.
Read More
chevron-down linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram