David Rosenberg says fraudsters used his name in a scheme that involved luring victims through professional-looking ads on social media.Fred Lum/The Globe and Mail
A Bay Street veteran and financial commentator is speaking out after finding himself at the centre of an alleged online “pump and dump” scam that used his identity to defraud some investors out of hundreds of thousands of dollars.
David Rosenberg, an economist and founder of Rosenberg Research, said ads appearing on Facebook and Instagram as early as March have promoted a fake investment program falsely listing him as its administrator.
Since then, he’s heard from several individuals who lost money to the scheme, a sum Mr. Rosenberg said he believes exceeds $1-million, though the total amount is unknown.
“We’ve been flooded with people coming to us and actually asking, is this for real?” Mr. Rosenberg said.
He said alarm bells rang for him when he received a message in April from a close friend asking how to invest through his new “Wolfpack program.”
“They said to me, ‘Is this something that small fish like us can invest in, or is it just for the big fish?’” Mr. Rosenberg said.
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Rosenberg Research offers ETF-based model portfolios that clients can mirror, but the firm doesn’t offer any investment programs under that name.
In the weeks that followed, Mr. Rosenberg heard from dozens of friends, acquaintances and strangers who were caught up in what appeared to be a pump-and-dump “pig butchering” scam.
“It’s a very vivid visual for a very devastating kind of victimization,” said Vanessa Iafolla, an anti-fraud consultant based in Halifax.
In these types of scams, victims are typically slowly lured over time, often through social media, and persuaded to invest increasingly larger sums through some form of misrepresentation.
“You’re getting this person to trust you,” she said.
Syed Hasan said he fell prey to the scam in April after stumbling on a Facebook ad for a program that recommended stocks that promised quick returns of 30 to 70 per cent.
An example of a social media ad that used David Rosenberg's name to defraud investors.Supplied
After being added to a WhatsApp group called (03) Rosenberg Investment Strategy, which appeared to include dozens of other investors, Mr. Hasan was recommended to trade in specific stocks.
The first stock he was pushed to buy had a recommended buy price of $2.91. After investing a small amount in the stock, it skyrocketed to $10 a month later – a 300-per-cent return, which gained his trust.
“You get greedy and think these guys know what they’re doing,” he said in an interview.
Emboldened by the first win, Mr. Hasan said he invested in another stock recommended by an administrator of the group pretending to be David Rosenberg. It plummeted from $1.27 to 20 cents during the first 15 minutes of trading hours, resulting in an 80-per-cent loss.
The first stock that they recommended also tanked 80 per cent at the same time. In total, Mr. Hasan estimated losing $16,000 over the course of the scam.
While significant, it was still less than other alleged victims who spoke with The Globe. One investor said she lost half a million dollars in just one week after clicking on an ad on Facebook and joining the WhatsApp group.
Mr. Rosenberg says he and his family tried unsuccessfully to stop the fraud by reporting it to authorities, including the local police and the Canadian Anti-Fraud Centre.Fred Lum/The Globe and Mail
Another victim alleged that he lost his life savings of $450,000 after falling for the scam. “At nearly 60 there will be no way to recover from this,” he wrote in an e-mail to Rosenberg Research.
The Globe is not identifying the alleged victims as they expressed concerns for their safety or professional reputation.
Mr. Rosenberg said all the investors were lured in by professional-looking ads posted to social media, which then redirected them to a WhatsApp group.
“They start by doing a proof of concept,” said Jacob Rosenberg, executive vice-president of client relations and operations at Rosenberg Research and Mr. Rosenberg’s son.
The scammers presented obscure securities that swung dramatically in price, creating an illusion of quick profits, he said. Once investors handed over money and saw a positive return, they were lured into sending more, Jacob Rosenberg claims.
For the past two months he has been fielding calls and messages from people reporting major losses. “I would be absolutely shocked if this isn’t in the millions,” he said.
Efforts by Mr. Rosenberg and his family to report the fraud to authorities, including local police and the Canadian Anti-Fraud Centre, largely went nowhere, he said. “It was a shrug of the shoulders.” Mr. Rosenberg added that the response prompted him to go public.
But although investors reported their experiences to Mr. Rosenberg, they have not filed complaints with the police. Det. David Coffey from the Toronto police financial crimes unit said that law enforcement officials need victims to come forward in order to investigate. “We haven’t had any victims report it,” he said.
Perpetrators behind these types of scams are often located outside the country and tracing a notoriously “murky” crime requires a wider effort involving telecom and social media companies, Det. Coffey said.
“Investment fraud, it’s the most prominent, most financially damaging, most profitable fraud,” he said. “There is a lot of money to be made, they’re making billions and billions.”
Investment scams in Canada were responsible for about $311-million in reported losses in 2024, and 3,866 reported victims, up 6 per cent from the previous year, according to the Canadian Anti-Fraud Centre. The agency estimates that 90 to 95 per cent of fraud goes unreported.