Pump and dump is a type of investment fraud that involves artificially inflating the price of a stock or other investment, and then selling it off at a higher price. The fraud experts on social media share information to temporarily increase the value of the stock.

Example:
Let’s say a group of fraudsters buy a large number of shares in a company. They then use tactics to promote the company to make people buy the stocks.

As more and more people start to buy the stock based on the hype, the price of the stock starts to rise. This creates a “pump” effect, where the fraudsters are able to sell their shares at a much higher price than they originally paid for them.

Once the price has peaked and the fraudsters have sold their shares, they stop promoting the company and the stock price begins to decline. This creates a “dump” effect.