Warning out vs Facebook IPO scams

With the initial public offering of social networking giant Facebook looming, netizens were warned Thursday (Manila time) against possible scams involving IPO-related offers.

 

Computer security firm Sophos said possible scams may include having victims click on malicious links disguised as offers for free Facebook stock.

 

"The opportunity for scams around Facebook’s IPO still remain today. I wouldn’t be at all surprised to see Facebook users duped into clicking on links and joining pages that offer them the gift of free Facebook stock for instance, as many people have still not learnt that there’s no such thing as a free lunch," it said in a blog post.

 

It reminded prospective Facebook investors to "go through the appropriate channels" if they decide to invest in the company.

 

"Look before you leap - and remember to be wary of deals that seem too good to be true or that arrive on your monitor unsolicited," it stressed.

 

Pre-IPO stock scam

 

Sophos noted that as early as last year, the Financial Industry Regulatory Authority (FINRA) alerted that fraudsters were trying to sell bogus pre-IPO stock in Facebook.

 

It said FINRA warned the public to be wary of unsolicited approaches that claim to offer access to shares of Facebook and other popular, well-known private companies.

 

“Investors might think they are getting in on the ground floor of innovative social media companies, but instead find that they may have handed over real money for non-existent shares,” Sophos quoted John Gannon, FINRA’s senior vice president for investor education, as saying.

 

Hyped-up IPO

 

Sophos noted Facebook’s IPO is the most hyped initial public offering in years, with much speculation about its value.

 

Facebook started in 2004 in Mark Zuckerberg’s Harvard dorm, and has gone on to claim more than 800 million users.

 

"And that’s useful data to have access to, if you want to be more successful at selling stuff. When you know that much about a person, it makes it easier to ensure that any advertising you do to them is very very targeted," it said.

 

"With an IPO as hyped and widely anticipated as Facebook’s, there are bound to be some bad eggs trying to take advantage of the situation," it added. — TJD, GMA News