Spam nuisance spreads to text messaging

We tracked the FDKE stock. On Aug. 24, it was selling for 10 cents a share. Then the wave of spam hit and the price skyrocketed. By Aug. 28, FDKE hit a high of 15 cents a share — a 50 percent increase. On Aug. 31, it dropped like a rock, down to a low of 7 cents a share.

I called Fredericks Entertainment to see what they know about all this. A secretary, who told me her name was Tania, answered the phone and told me, “No one here knows anything about it.” She said there was no one else there who could talk to me.

What should you do?
If you have a bundled plan, these messages didn't cost you anything, they just reduced the number of messages you can receive this month. If you pay per text message, it did cost you.

In either case, you can contact the customer service department at your cell phone company to get a refund or credit. If they won’t give you one, I would like to hear from you.

Stock spam is now a huge problem
The Internet security firm Sophos estimates that in 2005 less than 1 percent of spam involved pump-and-dump stock schemes. Today, it is about 25 percent.

According to the U.S. Security and Exchange Commission, there are 5.2 billion bogus stock alert e-mail messages sent each year. The spam come via e-mail, instant messaging and now text messages.

On Aug. 8, Sophos reported a massive pump-and-dump scheme. A half-billion e-mails were sent, touting the stock of Prime Time Group Inc. in Branson, Mo.

Part of the message, which came in a PDF file, read:

IMAGINE IF YOU HAD THE CHANCE TO BUY
A WAL-MART FRANCHISE IN MEXICO
RIGHT WHEN IT FIRST OPENED ITS DOORS
THERE AND ALL YOU NEEDED
WAS A SMALL STAKE TO GET IN.
Hurry, we see this stock starting
to make the turn NOW.
Big watch in effect for August 8, 2007!!!!

This one spam attack, Sophos claims, created a 30 percent jump in global spam traffic over a 24-hour period.

Who to contact If you receive investment-related spam, forward the offending message to .

The SEC has targeted this kind of market manipulation through its “Operation Spamalot.” On March 8, the commission suspended trading in the securities of 35 companies that were promoted via spam campaigns. This was the largest trading suspension in SEC history.

While some people may be fooled into buying a stock based on these spam alerts, I think it is fair to say many know exactly what they are doing. They are hoping to cash in on the action without risking a lot of money. The cyber scammers are counting on that.

“That small amount of money, generated by hundreds of thousands of people, means an awful lot to the guys reaping the benefits of the scam,” says security consultant Schmidt.

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