Red Flags!It's incredibly amusing to witness the "bashers" and "pumpers"
battle for credibility on this board. By the way did anyone ever
reflect on why Stockhouse chose the name "Bullboards"?
Here is another article by that well known author, Anonymous.
Enjoy!
THE RED FLAG CHECKLIST
1. Someone who hyper-posts on only one stock.
During the promotional run of that stock, he may be posting between 8
and 20 messages daily (sometimes more). He will promote for only so
long until he has exercised the stock options that he has been paid to
promote the stock or until his cash contract with the company expires.
2. Someone who uses multiple identities.
This is hard to detect. Generally, the poster will run with one identity
until he has become despised on the message boards. Then, he will
register again with a new identity. If one carefully studies such an
individual, it will be found that he posts repeatedly about the same set of
stocks, or just one stock. He will post during the same time each day or
night. His messages will commonly be the same length. His writing style
will be similar and he will use the same phrases or key words in his
messages. Often, this is the hired promoter. He is paid to post on
message boards throughout the Internet, either in cash or stock options.
3. Someone who repeatedly attacks or belittles others on a stock's
message boards.
This goes beyond the simple heated debate with one or two members
who disagree with him. If you carefully read his messages, this promoter
will sound like he is fighting for his life --with nearly everyone who
challenges him. This might be the CEO or investor relations employee for
the company or it could also be a hired promoter.
4. Someone who emerges as the stock's moderator, or even the leader of
the discussion group or that stock.
This person is different from someone who has a genuine fundamental
understanding of the company and who is also helpful. A promoter/leader
will diligently answer to virtually every negative comment made on "his"
message board. He will also cheerlead every positive comment and
constantly make an appearance on the message board to "show" he is still
the boss. Again, a paid promoter.
5. Someone with a short history in their member profile, who
suddenly shows up during a stock runup, and appears to know "all
about" the company.
This person is different from the excited investor, who just bought shares
in the company and is enthusiastic about it. The "impostering" poster hints
at "inside information" and quickly name-drops some connection to a
company insider or employee. While the "excited" investor may rave
about something an investor relations employee told him, the imposter
hints at important, but as of yet unannounced, development(s) that may
impact the stock price.
6. Someone who is nearly always the first to respond to company
developments.
Occasionally, someone else will beat him to it. Otherwise, he's first or a
close second almost every time. Paid promoters are paid to be on their
toes. Commonly, he will positively spin the news, to soften the blow of
less than good news or to make good news appear better than it actually
is.
7. Someone who continuously hints at upcoming company
developments, unreleased company news, unannounced contracts and
forecasts discoveries in natural resource exploration stocks.
Where did he get his information? Usually, he is the one who starts the
rumor and might often state that he heard it from someone else. Yes, he
did - a company insider. This is where the old cliché (Buy on the rumor;
sell on the news!) comes from: the company insider who leaked the news.
Paid promoter or company insider or long-term and trusted follower,
who is also a significant shareholder.
8. Someone who hypes the company during the runup and then
"changes" his mind and begins attacking the company, the company
insiders and the project.
This individual is different from the enthused investor who realized he
was just scammed. That person is less controlled in his emotions, which
is evident in what they write in their postings. The hypster carefully
controls his statements, both up the chart and back down. On the way
up, he may help the stock move higher by adding to the cheerleading, so
that he can build a substantial short position. Once he changes his mind,
it stays changed, though. The "excited" investor is confused and sounds
it, when you read his messages. The latter hasn't the slightest doubts
about his position on the company.
9. Someone who goes out of their way to find bad news about the
company and makes a "case" out of it.
These individuals might include ex-friends, ex-family (divorced) and
ex-employees, including ex-promoters. Such people don't just post a
single negative item. They either take one negative and make it look like
"the sky is falling" or they continuously bring it up. That an individual
makes frequent appearances to vent their spleen is the clue, which gives
them away. Disgruntled investors usually move on and don't want to be
reminded of their bad investment.
One way to cross-check the message board postings to determine if there
is an escaped fraudulent manipulator at large is to compare his posts
against the company news releases. The fraudulent companies generally
amplify their slightest achievements and play down their failures.
Companies with a history of failures - running a company into the
ground, never achieving anything of merit and diluting their market value
through the repeated issuance of new shares via private placements or
secondary offerings - tend to hire the most egregious and unscrupulous
promoters.
The above 9 Red Flags are by no means a complete list of warnings signs
and should only be used as guidelines to protect yourself from fraudulent
messages and posters.