ECONOMIC FRAUDS
DETECTION   &   PREVENTION   INC.
Our goal is to educate, warn and protect our clients
about frauds which can negatively impact their lives.

Go Back

Good to know

The Stock Swap

Still holding worthless stock, the investor is approached by someone posing as a sales representative of a legitimate-sounding company. It is important to note that the company named was not involved in the scam. The scam artist simply used the name of a legitimate company to make his pitch believable.

The sales representative told the victim that he represented a group of clients trying to acquire stocks that had recently declined in order to receive tax cuts. The sales representative proposed that the victim swap the worthless stock for recognized blue chip stock held by the tax-burdened clients.

For the purposes of the swap the victim’s stocks would be valued at the price(s) that the victim paid.

Since the blue chip stock was priced higher than the value of the victim’s stock, the victim was required to pay the difference in the value of the stocks. In one case, a victim submitted US$ 15,000.00 to an international bank where the suspect held an account. The victim did not actually receive the blue chip stock, but instead was swindled a second time.


© Copyright 2017 - All rights reserved