In a different twist on Pump & Dump scams, an allegedly phony press release announcing that a minuscule Wi-Fi provider, ICOA, Inc ( ICOA ) was acquired by Google, Inc. sent the stock in a frenzy.
Monday morning's press release, which was purportedly released by ICOA and disseminated by PRweb.com , stated that, "Google has announced its acquisition of ICOA Inc. A provider of Wi-Fi to high traffic public locations." The announcement could have easily been discredited by pulling up the Google symbol ( GOOG ) on any stock quoting service. Not surprisingly, the story was a phony and tons of people were hurt.
After barely trading for over two years, the stock was up as much as 400% on 3.33 billion shares of volume valued at just shy of $600K. Somebody obviously made a killing on the usually reliably gullible fools out there who don't even know that announcements like this come from the mainstream press and not Internet-only wire services. It's difficult to feel sorry for the dupes who were caught in this scheme, as they would have beent caught in some other penny stock scam anyway. This is why we preach staying away from penny stocks.
Of course Google reportedly denied the story, but somehow the news from the insignificant wire service still made the rounds on all the message boards. ICOA CEO, George Strouthopoulos denied knowing anything about the scam and in a brilliant evaluation, stated that that the press release may have been part of a conspiracy to manipulate the company's stock (no kidding!). Trading in the stock is now halted and there is bound to be some fall out from PRweb.
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