By Jorge Casuso
April 17, 2026 -- The Santa Monica Police Department is warning against fake “can’t lose” investment schemes in stocks and cryptocurrency circulating on social media.
The Investment Scam Alert issued on SMPD's Facebook page Tuesday focuses on "pump and dump" schemes that "hype cheap stocks or crypto in group chats, then cash out and leave victims with big losses."
A second scheme involves "confidence scams," in which fraudsters "build a relationship, walk you through a fake 'investment platform,' show fake profits, then disappear with your money."
Red flags to watch for include “guaranteed” or “risk-free” returns and "celebrity or influencer investment ads" that are often fake or generated by AI.
Other alerts are high-pressure “act now” messages, requests to move the conversation to WhatsApp or Telegram and demands to pay or invest in cryptocurrency only.
An increasing number of scammers are using Meta platforms like WhatsApp, Facebook and Instagram, according to reports.
"Social media platforms are now the dominant distribution channels for pump-and-dump schemes and fraudulent securities offerings," Seth Oranburg, a professor at the University of New Hampshire Franklin Pierce School of Law, wrote in Bloomberg Tuesday.
Police advise users to research before investing and "never rely only on social media posts or DMs (Direct Messages)." Other protections include verifying professionals at https://www.investor.gov/
"Be skeptical of offers 'from a friend' whose account could be hacked" and "never share login info, Social Security numbers, or remote access to your devices with anyone you met online," the alert advises.
"If it sounds too good to be true, it probably is."
SMPD joined law enforcement agencies nationwide who have been issuing alerts over the past week.
According to the Federal Trade Commission (FTC), "people are losing big money on investment scams" nationwide.
More than $7.9 billion in losses to investment scams was reported last year, with a median individual loss of more than $10,000, according to FTC data.
Those who believes they have been targeted or victimized by an online investment scam should report it to the Santa Monica Police Department, their bank and the FBI’s Internet Crime Complaint Center at www.ic3.gov.