Penny stock selloffs fuel concerns over pump-and-dump scams - report

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Tim Robberts

Investors lost billions of dollars on certain U.S.-listed Chinese stocks that tanked soon after being promoted on social media, the _Financial Times _has reported, raising concerns over potential pump-and dump scams.

The report mentioned seven stocks - Concorde International (NASDAQ:CIGL [https://seekingalpha.com/symbol/CIGL]), Ostin Technology (NASDAQ:OST [https://seekingalpha.com/symbol/OST]), Top KingWin (NASDAQ:WAI [https://seekingalpha.com/symbol/WAI]), Skyline Builders (NASDAQ:SKBL [https://seekingalpha.com/symbol/SKBL]), Everbright Digital (NASDAQ:EDHL [https://seekingalpha.com/symbol/EDHL]), Park Ha Biological Technology (NASDAQ:PHH [https://seekingalpha.com/symbol/PHH]) and Pheton Holdings (NASDAQ:PTHL [https://seekingalpha.com/symbol/PTHL]) - that fell more than 80% over a few recent trading sessions.

There is no suggestion that these companies were involved in the unusual stock moves, according to the report, but analysts and investors say the moves appear to resemble pump-and dump scams.

The stock declines wiped a combined $3.7B off their market value, according to predictive analytics firm InvestorLink. Notably, before their sudden declines, all seven stocks had surged after being promoted on social media apps like WhatsApp.

_FT _also mentioned [https://www.ft.com/content/38c9815b-8ccc-40d5-bcbf-cfdb8b73ffa6] Regencell Bioscience (NASDAQ:RGC [https://seekingalpha.com/symbol/RGC]), whose shares surged nearly 10,000% YTD, adding there's no suggestion that the company was involved in its stock moves. In June, SA analyst Atticus Analysis warned that Regencell would likely follow the boom-and-bust pattern [https://seekingalpha.com/article/4795751-regencell-bioscience-fundamentals-and-meme-stock-potential-are-both-lacking] of other Chinese/Hong Kong names.

Last month, the Federal Bureau of Investigation said victim complaints referencing ramp-and-dump stock fraud increased 300% from a year ago.

The FBI noted [https://www.ic3.gov/PSA/2025/PSA250703] that investors were being targeted via social media advertisements or messages promoting an "investment club," where some members may be bots. "To appear credible, perpetrators may impersonate legitimate brokerage firms or well-known stock analysts."

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