Spoofing


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Spoofing

1. An illegal practice in which an investor with a long position on a security makes a buy order for that security and immediately cancels it without filling the order. Spoofing tends to increase the price of that security as other investors may then issue their own buy orders, which increases the appearance of demand. The first investor then closes his/her long position by selling the security at the new, higher price. Spoofing is a form of market manipulation. See also: Pump and dump.

2. The act of impersonating a person, usually over the Internet, with the intention of gaining access to another's personal or financial information. It is a means of identity theft.

Spoofing.

Some market analysts maintain that the increased volatility in stock markets may be the result of an illegal practice known as spoofing, or phantom bids.

To spoof, traders who own shares of a certain stock place an anonymous buy order for a large number of shares of the stock through an electronic communications network (ECN). Then they cancel, or withdraw, the order seconds later.

As soon as the order is placed, however, the price jumps. That's because investors following the market closely enter their own orders to buy what seems to be a hot stock and drive up the price.

When the price rises, the spoofer sells shares at the higher price, and gets out of the market in that stock. Investors who bought what they thought was a hot stock may be left with a substantial loss if the price quickly drops back to its prespoof price.

Spoofing is a variant of the scam known as pump and dump.

References in periodicals archive ?
Another think tank, Digital Shadows, said the geographical placement of Russian spoofing incidents closely aligns with places where Vladimir Putin was making overseas and domestic visits.
In this paper, we propose a fast and robust method to detect spoofing attacks in face recognition-based login system.
As FINRA explains, layering refers to entering limit orders with the intended effect of moving the market to obtain a beneficial execution on the other side of the market, while spoofing refers to entering orders to entice other participants to join on the same side of the market at a price at which they would not ordinarily trade, and then trading against the other market participants' orders.
It is therefore important to note that there must be a crime committed or concealed, in addition to the IP address spoofing activity, for a person to be liable under this provision of the law.
The number of individuals that use caller ID spoofing has definitely grown over the years and continues to grow as more people learn about the service.
However, as columnist Yavuz Baydar wrote in his column in the BugE-n daily on Tuesday, DNS spoofing is a method used by authoritarian states such as Iran and China, where the state monitors the online activities of its citizens.
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Collins also dresses up as a bride, spoofing Tate's Doctor Who character, while Carr mimics Lauren "Am I bovvered?" Cooper.
A new report from the Information Security Forum (ISF) warns that along with existing security problems associated with IP networks, voice over IP (VoIP) will present new and more sophisticated threats, such as caller ID spoofing, voice modifiers, spam over Internet telephony (SPIT) and packet injections.