The "pump and dump" lives, apparently.
Shares of ICOA Wireless soared earlier Monday on news that Internet behemoth Google had acquired the wireless hotspot company for $400 million. The problem? The buyout never happened.
The CEO of ICOA told Reuters in an email Monday that it never had buyout talks with Google and that it has contacted authorities to look into what it called a hoax press release.
"Someone, I guess a stock promoter with a dubious interest, is disseminating wrong, false and misleading info in the PR circles," ICOA CEO and Chairman George Strouthopoulos told Reuters.
According to the Wall Street Journal's "All Things D" blog, the fake press release was disseminated on PRWeb, which is a free service operated by the PR firm Vocus. The Wall Street Journal called PRWeb to ask it about the press release, but has not heard back from anyone yet.
"We are investigating the source, so far it originated from Aruba," Strouthopoulos told Reuters. He did not elaborate.
In the meantime, shares of ICOA retreated to .0001 cent in later afternoon trading after rising to .0005 cent when the two paragraph press release got investors excited and fooled some news organizations and blogs.
That quick rise and fall could have spelled swift profits for some unscrupulous investor or investors in the type of scheme that pumps up a stock price with false information. The investor(s) then dump the shares quickly before others in the market get wind of the misinformation. Hence the "pump and dump" moniker.