(How to Spot a Penny Stock Scam)
今天阅读到一篇不错的识别penny stock spam有关的文章，ZT如下。一些分析手段有意思，比如利用Whois tool研究该公司网页建立的时间，又根据该公司网页来识别一些必要的公司情况和可疑之处等等。
Tell me if this has happened to you: You’re sifting through your email and a four-letter acronym catches your attention. You have never seen it before so you know it must be a company you have never heard of. The subject line contains something eye-catchy, so you click on it and are pulled into the idea of buying shares of a company for pennies RIGHT NOW because soon it will SKY ROCKET into several dollars, and you don’t want to miss out on this EXCITING opportunity so you consider buying BEFORE ITS TOO LATE!
Okay, don’t tell me, because chances are it has. Penny stock scams are literally everywhere. From emails and online forums to paper solicitation and scuttlebutt, people from all different walks of life are exposed to “the next ten-bagger” that will rake in the fortunes. As a penny stock aficionado, you know that it takes a little more research than normal to ensure that you don’t lose all of your money in some Nigerian “I am a prince who needs a bank account to deposit my one hundred beelion dollars” scam (or equivalent penny stock scam). As such, I have decided to choose the most recent scam I have found, Force Energy Corporation.
First, lets set some constants in this world of variables:
- I received an email from a website I visit that is a solicitation to purchase shares of FORC.
- As I am writing this, I have no idea whether or not FORC is a scam company or not, but I do know that they trade on the OTCBB, which is a lot better than Pink Sheets.
- I am going to go through step-by-step the DD that I that do in order to ensure that a Pink Sheet company is not a pump-and-dump scam.
Alright, so now that we have that on the table, let’s get started.
Email Spam Usually Means Scam
Anytime a company uses email spam to solicit the sale of their stock, chances are you are looking at a classic pump-and-dump scheme. While the pump-and-dump is covered in a separate article, basically it is when a lot of marketing and advertisement will “pump” up the share price so that the scam artists behind the whole shenanigan can “dump” the shares and take everyone’s money – note that this is perfectly “legal” because the Pink Sheets are an unregulated market and the SEC has very few restrictions on how Pink Sheets are bought and sold. This doesn’t mean that people can do whatever the hell they want, but it is a lot looser of a market than, say, the NASDAQ.
Let’s take a look at the following email that I recieved:
Force Energy to Drill Key U.S. Oil-Project
– FORC shares set to spike from $0.40 to above $3 –
“This is the profit-bonanza we’ve been waiting for – make sure
you own FORC now at the current $0.40 per share level”
Force Energy – our #1 LOW risk / HIGH reward explorer – reports an estimated 4.3 Million barrels of oil at shallow depths at its Diamond Springs Prospect.
Let’s do the math: Oil is trading right around $75 per barrel. If we use even a very conservative estimate of just $65 per barrel – Force Energy should be sitting on a staggering $280 Million in crude.
That’s a ton of oil for a 40-cent stock that I project will soon be trading many multiples higher.
Even if Force Energy only proves a fraction of the 4.3 Million barrels estimated on its Diamond Springs property, the reactive industry buying as phase-one drilling begins should still drive your FORC shares quickly above $3.
I am presenting you with a rare and potentially life-changing opportunity to own a true under-the-radar oil stock right before it makes its next projected upward run.
And I can say with 100% confidence – No one knows more about Force Energy from a profit-perspective than I do. My first FORC buy-recommendation was rewarded with a quick share-price triple.
Now is the optimum time to be buying Force Energy again because the company is about to start the one thing – DRILLING – that will determine how high the FORC share-price can go.
If you read through the whole thing you will notice that it sounds very familiar. A lot of websites use this sort of template to solicit all kinds of products. The general methodology is this:
- How can they make money
- How much will they make
- The “Even if” factor… Percievably eliminating the risk involved
- How rare this opportunity is
- 100% guarantee
- You Must Buy Now Before Its Too Late!
We will come back to this list in future tutorials, but for now just look at each list item individually and go back up and read through the email – see how each item is covered?
At the end of the email, it tells you to read their “official FORC report”, which is linked here. Skim over that website, and the list should start popping up everywhere. “A once in a lifetime opportunity”, “700% profit”, “look at how much money I have made people before”, “you can’t lose”, “its a win-win”, “oil is the future”, “look at how much MONEY!!! you’ll make”. There are sites like this everywhere, and they’re usually for e-books and other internet get-rich-quick schemes, but now it looks like penny stock scams are using them as well.
Anyway, let’s not veer too far from our goal here. First, lets take a look at the link to the “Official FORC Report”, which is at a base URL of http://www.hostrrmg2.com/. If you navigate there, you will see that its not a site that has been set up yet. A Google search for the domain comes up with nothing, which means it is less than a week old, so we move on to a WhoIs search: http://whois.domaintools.com/hostrrmg2.com.
As you can see from the results, the WhoIs reveals that the domain was registered January 21st, 2010, with a 1-year expiration. This tell us two things:
- This marketing campaign is relatively new, and
- There is no long-term commitment with this particular advertisement venue
Now you tell me: Does a profitable, investment-safe company establish a website for only a year, or even just register it for a year because they are not sure if they will still be in business longer than that? Digging deeper we find two instances of a mention of marketing funds being involved. The first is in the email, where it says, verbatum, “This email is sent on behalf of a paying third party.” The second is on the website linked to above, where it says in the fine print at the end of the page, verbatim (go ahead, look!), “This stock profile should be viewed as a paid advertisement. In order to enhance public awareness of Force Energy and its securities through the distribution of this report, Mass Media Advertising paid the publisher, Natural Contrarian, Inc. the sum of $105,000.”
Holy cow! One hundred and five thousand dollars to advertise and pump up this stock. If you read the website and thought, “wow, this sounds AWESOME!”, then it definitely was worth it. Don’t worry, though, I thought the same thing, too. Heck, I STILL think these things sound cool when I read them even if I know they’re a scam, because that’s what they pay advertising companies hundreds of thousands of dollars to do – come up with awesome-sounding advertisements. The trick here, friends, is being able to know when its purely entertianment and when it’s real DD. Obviously the website is not the latter.
The Penny Stock Scam Website
Sometimes you can avoid all the DD you have to do by just analyzing the company’s website. In this case, we are talking about www.ForceEnergyCorp.com. Go ahead and navigate there and check it all out for a bit.
The first thing you should notice is that it’s clean and the language is well-written. If you come across a website that is supposed to be a big company’s page that is poorly written or contains more than one spelling error on the entire site, be wary of the company in question.
Now let’s look at the most important page of them all. Skip all the content and other pages, and go straight to the “Contact Us” page. The address they have on file is 1400 16th Street, 16 Market Square, Suite 400, Denver, Colorado. It’s not a foreign address, and it’s not a P.O. box (not that all companies listing a P.O. box are necessarily scams, but it’s a good reference point) so that’s good. All we have to do now is a quick Google search for what’s there, to make sure we don’t run into another Frontier Energy Corporation (FRGY) who’s business address was listed as a residential address.
Well, according to this page, it is an executive office suite – kudos to FORC. But wait, it looks like another company – Virtuoso Partners - is co-located at that address. Hmm, maybe they share an office? A quick call to the number listed on Virtuoso’s webpage and I was immediately connected with a secretary, who assured me that they were not no-located with anyone. Smells more and more like a bull has diherrea, doesn’t it?
Okay, fine – I’ll prove it:
First, the WhoIs for forceenergycorp.com gave me an address in Canada (specifically, Suite 401, 510 West Hastings Street, Vancouver, British Columbia V6B 1L8). I searched that address in Google and came up with another company at the same address, Sterlingpac.com.
Second, I checked the sourcecode for sterlingpac.com, and found a commented-out (that means it was there at one time and was removed) for visiongateventures.com. I further searched for Vision Gate Ventures and found an SEC filing for a sale of securites in 2003. From there, the president’s name, John E. Lando, was found. Google his name, and you will find him associated with a paid public-relations post on a blog that promotes a TSX (the Canadian stock exchange)-traded company New World Resource (www.newworldresource.com).
Third, and probably the coolest, is that at the same time I was searching for John Lando, I was also trying to investigate the link on the sterlingpac.com website to a NorthernLionGold.com, Sterlinpac.com’s “latest project.” It was then that I realized that northernliongold.com and newworldresource.com were created using the exact same engine, were structured the exact same way, and holy monkey, have the same address.
S to the C to the A to the M. SCAM.
It wouldn’t be so apparent if all these companies weren’t trading for sub-dollar, but that definitely highlights the fact that they’re creations of scam artists.
Is It Really That Easy?
So is that all the DD we should do? Absolutely not! You still need to dig futher to see if the PPS fluctuations go along with new releases or earnings reports (more on that in a different tutorial), and if the company has any public financial statements (which are usually hard to come by).
In this tutorial I’ve taken you step-by-step through the process I take in identifying a scam Pink Sheet company. While FORC is technically trading on the OTCBB, it’s still a Penny Stock Scam to me! Most importanly in this tutorial is all the DD you can do using only Google and the company’s website as your start point!
So go forth, Pink Sheet traders, armed with this new knowledge and tackle the Pinks. All I ask is that when you spot a scam – and believe me, there are more scams out there than actual companies – you share that scam with us and the rest of the world here, at DDUnderground.com.