Associated Incidents
Media Release
MR No. 2025 -- 41
Kiwi investors are being caught by a new "pump and dump" scam, says the Financial Markets Authority (FMA) -- Te Mana Tātai Hokohoko.
FMA Director of Markets, Investors and Reporting, John Horner says: "As we start World Investor Week, aimed at educating and protecting investors, it is timely to remind Kiwi investors about this latest version of the deepfake impersonation scam. We have issued a new warning."
"This current scam uses social media scam advertisements featuring an impersonated business leader, encouraging investors to join a fake investor chat group. The FMA first raised its concerns about the impersonations in a public warning issued 19 August 2025, and has received further information showing the scam is part of a global network of scams aimed at market manipulation."
A pump and dump occurs when a person buys shares in a company and starts an organised campaign to increase (or 'pump') the share price. They then sell (or 'dump') their shares and make a profit, while the other shareholders suffer financial losses as the share price falls.
Often those running a 'pump and dump' use social media and online forums to create a sense of excitement about buying a company's shares by spreading false information about the company's prospects. This excitement and interest artificially drives the share price up as they lure investors. This is considered a form of market manipulation.
The pump and dump scam uses Facebook and Instagram ads impersonating a variety of well known Kiwi business leaders to target Kiwi investors, inviting them to join a chat group on a messaging platform such as WhatsApp. There, they are encouraged to use reputable trading platforms to buy low-value shares in companies listed on overseas exchanges, to artificially inflate the share price. The scammers sell their own shares at the inflated price and, when the price later drops, the victims are left bearing the loss.
After a victim suffers a loss, the scammers often claim, falsely, that the victim is entitled to compensation or reimbursement. The scammers then collect personal information and further payments from the victims.
"We have received a number of complaints, with multiple victims having lost significant amounts," said John Horner.
"These complaints are likely only the tip of the iceberg. Because these impersonation pump and dump scams play out over days and weeks, it's possible there are others happening in New Zealand right now, with the scammers potentially pivoting to another company's shares.
"We encourage New Zealanders to take extra care when considering investment decisions and seeking out investment advice. If an organisation is offering investment tips through social media, be cautious. Report any suspicious activity to the social media channel, to the company involved and to the FMA.
"We urge extreme caution to investors impacted by this or other scams which may include 'opportunities' to trade out of this position or support to recover funds lost, these are also likely to be scams."
"One of the FMA's functions is to promote the confident and informed participation of businesses, investors, and consumers in the financial markets.
"We have therefore taken steps to urgently issue an updated public warning to raise awareness of how this scam impacts investors and educate the general public on how to avoid being scammed.
Investment advice group chats used in suspected pump-and-dump schemes
"Our aim is to make New Zealand an unattractive place for scammers to operate, by raising awareness of scam methods and encouraging investors to stop and think carefully before making investment decisions that might be driven by a scam."
The FMA is also sharing case details with the relevant overseas financial regulators, given some of the pumped shares are listed on a US exchange (NASDAQ) and some of the pumped companies are based in China. "There are currently similar scams operating overseas, with a warning recently issued by the FBI
The FMA has also alerted New Zealand banks and businesses being impersonated to let them know the impersonation scam has pivoted and is using new tactics, and is encouraging them to share the FMA warning.
Investment advice group chats used in suspected pump-and-dump schemes
Imposter Facebook pages used to promote WhatsApp investment scam
ENDS
Media contact:
Ellie Martel
FMA Senior Adviser, Media Relations
Media.fma@fma.govt.nz
021 241 7868