03:50 PM
VeriSign Unveils Real-Time Protection Against "Pump and Dump" Fraud
VeriSign , a provider of Internet infrastructure services, released a new solution designed to stop online traders from falling prey to stock manipulation schemes.
The VeriSign Identity Protection (VIP) Fraud Detection Service Stock Trading Module protects traders at the transaction level, by tracking behavior specific to stock trading scams, the company said.
The module uses the VIP Fraud Detection Service's self-learning behavioral engine to spot pump and dump activity by tracking and weighing multiple factors including stock risk, user behaviors, how trading compares to typical fraudulent trades, and the network effect that occurs when many users are making similar trades. Examples of existing pump-and-dump schemes around include those that dupe legitimate traders into buying stock on rumor, or ones that take over user accounts and purchases penny stock in large quantities. In both cases, when the stock price rises, fraudsters quickly dump their shares, collecting gains for themselves and causing investors and brokerages to lose money.
"New stock frauds are far more sophisticated than the 'traditional pump and dump' scams," said Chris Christiansen, program vice president, Security Products and Services at IDC. "The attacks enable criminals to fraudulently pump up an unknown stock's price via unauthorized purchases from co-opted accounts. VeriSign offers a unique service that protects traders at the transaction level and customer's accounts from being compromised."
Melanie Rodier has worked as a print and broadcast journalist for over 10 years, covering business and finance, general news, and film trade news. Prior to joining Wall Street & Technology in April 2007, Melanie lived in Paris, where she worked for the International Herald ... View Full Bio