Investor Protection Guide: Micro-cap Stock Fraud ("Pump and
Dump")  "Pump and Dump" is a type of stock fraud involving the
use of false or misleading statements to increase stock prices
and then sell the inflated stocks to the public.  Stocks of
microcap companies, which have low capitalizations and limited
assets, are highly vulnerable to “pump and dump” because they
can be easily manipulated.  Microcap stocks often lack reliable
public information about the company and have a limited
historical record.  Many of them trade on the over-the-counter
(OTC) markets such as the OTC Bulletin Board (OTCBB) or OTC Link
LLC (OTC Link).  OTC markets lack transparency in trading and
have lax financial standards.  A typical “pump and dump” scheme
begins with stock promoters loading up on stock of a microcap
company.  The promoters then “pump” the stock by disclosing fake
“inside” information of the company and claiming that huge price
gains will follow.  For example, they may say that the company
received FDA approval on