Problems in Chinatown
A Deep Dive Into Criminal Stock Scams
Today, The Bear Cave delves into the criminal underworld that powers U.S.-listed Chinese stock scams. For years, stock manipulators in China have promoted tightly held non-substantive Chinese companies to U.S. investors, causing billions in investor losses.
This trend was first highlighted in the 2017 Netflix documentary The China Hustle. More recently, a June 16, 2025 Wall Street Journal article “Obscure Chinese Stock Scams Dupe American Investors by the Thousands” noted that fighting Chinese stock promotions is “a priority of the Trump administration’s white-collar enforcement program.” The article highlighted a March 2025 seizure of $214 million from the U.S. bank accounts of several individuals who promoted China Liberal Education Holdings stock, which fell ~98% in January.
And in a July 3, 2025 bulletin, the FBI warned:
“So far in 2025, the FBI has seen at least a 300 percent increase in victim complaints referencing ramp-and-dump stock fraud from 2024.”
The FBI wrote, in part:
“[The criminals] secretly control a large volume of a low-priced stock and coordinate efforts to inflate its price (‘ramp up’) by encouraging investment club members to purchase shares over a period of several weeks or months. Once the price is artificially elevated, the criminals sell off (‘dump’) their shares at a profit, leaving unsuspecting investors with significant losses as the stock value collapses.”
Recent examples of U.S.-listed Chinese companies stock promotions being dumped on investors include Top KingWin (NASDAQ: WAI), which fell ~90% on July 7, Park Ha Biological Technology (NASDAQ: PHH), which fell ~93% on July 8, Concorde International Group (NASDAQ: CIGL), which fell ~80% on July 10, Everbright Digital Holding (NASDAQ: EDHL), which fell ~80% on July 14, and Picocela (NASDAQ: PCLA), which fell ~76% on July 15.
Another example of a Chinese stock scam collapsing is Ostin Technology Group (NASDAQ: OST), which reached a peak market capitalization of over $1 billion before falling ~93% on June 26. In a July 8 post “Anatomy of a WhatsApp Stock Scam” Herb Greenberg summarized the words of one victim:
“After clicking on an Instagram ad showing a video of Tim Ferriss (known author), between May 8th and June 26th, 2025, I was the victim of a highly coordinated pump-and-dump fraud involving the security OST (Ostin Technology Group), which is listed on the NASDAQ.
Over a period of approximately 6 weeks, I was manipulated, partly through recommendations for a series of small wins, into making what I now understand to be extraordinarily risky and irrational purchases of OST stock, resulting in financial losses of around $70,000.
This fraud was orchestrated through a WhatsApp group that impersonated legitimate investment advice communities.”
The scams have gone on for so long and become so brazen that scammers routinely impersonate SEC officials after the stock collapses. Below, a scammer impersonates SEC Enforcement Acting Director Samuel Waldon to investigate “the malicious short selling” around OST while another scammer reaches out to victims pretending to be an SEC official investigating the scammers. According to victims, the scammers impersonating SEC officials gather information about investor losses and pitch sham recovery services that again scam investors looking to recoup their losses.
The Bear Cave has gained access to many of these scam WhatsApp groups and concludes that we are entering a golden age of coordinated stock promotion. Let’s dig in.