When your stock is actually a scam

July 2, 2025

By Kim Komando

I don’t mean to be a downer, but I need to warn you that tens of thousands of Americans, folks just like you, are getting duped into buying worthless Chinese stocks. 

The Wall Street Journal (paywall link) found even seasoned investors are falling for this scam, losing big bucks in the blink of an eye. 

How the scam goes down 

Fraudsters hype obscure Chinese companies using flashy but totally fake online marketing. We’re talking bogus financial reports, glowing endorsements from so-called “experts,” and completely made-up news stories claiming revolutionary breakthroughs. 

It’s like the Netflix Original version of Wall Street. Investors think they’ve discovered the next Tesla or Amazon. Fraudsters generate online buzz like it’s a Marvel premiere. 

You’ll see anonymous Reddit accounts praising a “groundbreaking diagnostic technology” that cured their dog’s cousin’s gluten allergy. Influencers squeeze out TikToks looking like TED Talks, promising, “You’ll 10X in 3 days or I’ll eat this protein bar on camera.”

Then the scammers quietly cash out, the stocks crash, and everyday people are left holding worthless paper.

• Mike from Texas dropped over $40,000 after he followed advice from an online forum screaming success about a so-called groundbreaking Chinese biotech company.
• Emily, a teacher from Florida, poured her entire retirement savings into a Chinese company promoted by a convincing finance influencer. Turns out, the company didn’t even exist. Her retirement vanished almost overnight.
• Jim from Illinois? Fell for sleek emails teasing “exclusive tips.” The only thing exclusive about it was how fast his kids’ college fund evaporated chasing a Chinese electric vehicle startup that disappeared overnight.

So, what do you do?

Be smarter. Please.

1. Steer clear of “secret tips”: If someone promises huge returns on a secret investment, walk away. It’s all smoke and mirrors.
2. Do your homework with trusted sources: Cross-check on Bloomberg, Yahoo Finance or the SEC. Can’t find details? Run. If you’re sourcing from a comment section, stop. 
3. Watch out for social media buzz: Hype on Reddit, Twitter and Discord is a huge red flag. Influencer-driven frenzy rarely points to solid investments.

Don’t let scammers ride off into the sunset with your life savings while you’re left in an empty Reddit asking, “Wait, did anyone else lose everything?”

🔮 What do you call a giant psychic who manipulates the stock market? A tall medium who shorts. (lol)