SFO - Serious Fraud Office

Share ramping

What is share ramping?

Share ramping (also known as 'pump and dump' and 'book ramping') is where criminals influence the share price of a company and then take advantage of it.

  • It is commonly done by bringing a company to the market with false expectations of its profitability.
  • Alternatively it can be done by buying shares in a company when they are at a low price and then starting a rumor that the company is being taken over. When the share price rises, the shares are sold at a profit.

 

Where can I get more information?

The Financial Services Authority (FSA) is the primary organisation that investigates share ramping

External site - opens in new window

If you have information on share remping that fits our acceptance criteria, then you can also report it in confidence using our secure online reporting form. You can also send details to us in writing at: SFO Confidential, Serious Fraud Office, 2-4 Cockspur Street, London, SW1Y 5BS.

 

Case example

Three British directors of an American mining operation deliberately concealed personal interest in a new share issue.

Two of the three guilty men were Board members of the mining company. Due to their professional involvement, they should have declared their personal stakes in the company when new shares were being issued on the London Stock Exchange - but they did not. The flotation was presented as a 'chance to strike gold'. A consultancy firm produced an attractive report on the company's prospects. However, the value of precious metals and base ore to be extracted from the mine workings at the company were overvalued and the shares soon tumbled in value.

The resulting gains made by the fraudsters out of the flotation, over £60 million, were hidden in an intricate network of offshore companies. This was only discovered during a raid on a Jersey accountancy firm.

A joint investigation between the SFO and the City of London Police followed. The paper trail, which had started in Jersey, led investigators to Hong Kong, New Zealand, Monaco, France, Switzerland and Canada as well as where the company was located in the USA, in order to unravel the ownership of a web of offshore companies.

An eleven-month trial finished with the conviction of three out of four men on conspiracy to defraud charges in relation to a gold, silver, lead and zinc mining business in the USA.