The Candy Valentino Show: Episode Summary

Title: The 500M Hawk Tuah SCAM and How To Avoid Them
Host: Candy Valentino
Release Date: December 12, 2024
Podcast Network: Cumulus Podcast Network

1. Introduction

In this gripping episode of The Candy Valentino Show, host Candy Valentino delves into a significant fraud case that has captured headlines across major media outlets, including BBC, Rolling Stone, Fortune, Yahoo Finance, and Forbes. Candy aims to shed light on the deceptive practices that led to substantial financial losses for many innocent investors.

2. The Rise and Fall of Hayley Welch

Candy begins by narrating the story of Hayley Welch, whose fleeting moment of viral fame became the foundation for an elaborate scam:

• Viral Moment: Hayley Welch gained sudden fame after an interview in Nashville where, under the influence, she responded with the phrase "hoch to," which quickly went viral, accumulating millions of views overnight despite her lack of social media presence or professional background. (0:56)

• Podcast Launch: Capitalizing on her newfound popularity, Welch launched a podcast featuring high-profile guests like Mark Cuban and Jake Paul. Her followers, enamored by her sudden success, trusted her despite her lack of expertise. (2:30)

• Cryptocurrency Venture: Welch ventured into the cryptocurrency space by launching the digital coin "Hawk Tuah." The coin swiftly reached a market cap of $500 million within hours before plummeting 95% in value, a classic example of a pump and dump scheme. (4:10)

3. Understanding Pump and Dump Schemes

Candy provides a detailed explanation of pump and dump schemes to help listeners recognize and avoid such frauds:

• Definition: Pump and dump is an illegal practice where perpetrators artificially inflate the price of a stock or coin through misleading or exaggerated promotions. Once the price peaks, they sell off their holdings, causing the value to crash and inflicting heavy losses on unsuspecting investors. (3:15)

• Modern Adaptation: While traditionally conducted through cold calling, the advent of social media has made it easier for fraudsters to influence large audiences quickly. Celebrities and social media influencers often become unwitting accomplices in these schemes by promoting cryptocurrencies without disclosing their financial interests. (4:50)

4. The Mechanics of the Hawk Tuah Scam

Candy dissects the specific case of Hawk Tuah to highlight the mechanics and impacts of the scam:

• Market Manipulation: At launch, Hawk Tuah's value surged to nearly $500 million. Insider control, with 80-90% of the supply held by insiders, created an artificial demand that quickly inflated the coin’s price. (5:15)

• Price Collapse: Within minutes, the coin's value crashed to approximately $0.002, wiping out investors' savings almost overnight. This rapid decline exemplifies a "rug pull," where developers abandon the project after extracting money from investors. (8:28)

• Regulatory Attention: The Commodity Futures Trading Commission (CFTC) has intensified scrutiny of such fraudulent activities, emphasizing the need for investor protection in the volatile cryptocurrency market. (7:45)

5. High-Profile Scams and Their Implications

Candy draws parallels between the Hawk Tuah scam and other high-profile cases involving celebrities to underscore the pervasive nature of such frauds:

• Logan Paul: Accused of misleading fans by promoting crypto investments without revealing his financial stakes, thereby manipulating public perception. (5:50)

• Kim Kardashian: Fined over a million dollars for failing to disclose her paid endorsements of the cryptocurrency scheme Ethereum Max, misleading her followers. (6:20)

• Industry Trend: These incidents highlight a troubling trend where influencers exploit their platforms to endorse dubious financial products, leading to widespread financial harm among their followers. (6:50)

6. Protecting Yourself from Investment Scams

Candy offers practical advice on safeguarding against investment fraud, emphasizing education and due diligence:

• Research Thoroughly: Investigate the project, developers, and their track records. Look for white papers and detailed project plans to understand the investment's legitimacy. (8:50)

• Understand the Risks: Recognize that 90-97% of such investments fail. Diversify your portfolio with reputable assets like traditional stocks, ETFs, REITs, mutual funds, and established cryptocurrencies. (9:30)

• Seek Professional Advice: Consult with certified financial professionals or fiduciaries to make informed investment decisions. (10:10)

7. Steps to Take If Victimized by a Scam

In the unfortunate event of falling prey to an investment scam, Candy outlines actionable steps to mitigate losses and prevent further victimization:

1. Stop Transactions Immediately: Cease all future financial dealings with the scam entity to prevent further losses. (10:45)

2. Report the Scam: Notify relevant regulatory bodies such as the SEC, online platforms, and other authorities to aid in investigation and potential recovery efforts. (11:00)

3. Seek Legal Counsel: Depending on the severity of the loss, consult with a lawyer to explore legal remedies and possible compensation. (11:30)

4. Raise Awareness: Share your experience on social media and within investment communities to warn others and help prevent widespread victimization. (12:00)

8. Conclusion

Candy wraps up the episode by reiterating the importance of vigilance and informed investing. She emphasizes that building wealth is a long-term endeavor best achieved through consistent, educated investment strategies rather than chasing high-risk, hyped opportunities. Ending on a note of empowerment, Candy encourages listeners to stay informed, remain skeptical of overly promising schemes, and prioritize financial literacy to secure their financial futures. (12:30)

Notable Quotes

• Candy Valentino, 00:56: "Today's topic I want to talk about is hitting headlines everywhere... how many good, well-intended people lost not only money, but some of them lost their entire life savings."

• Candy Valentino, 04:10: "This is what we call pump and dump. So what is pump and dump if you haven't heard of it? Well, basically it is an illegal Scheme that attempts or successfully boosts the price of a stock or coin or a security through fake recommendations."

• Candy Valentino, 08:28: "The coin's value is now not even worth a cent. 0024 to be exact. So every single person that was involved, that thought they were investing in somebody, that they followed online, have just lost all of their money."

• Candy Valentino, 10:45: "Stop all further transactions immediately. Stop any future transactions. Do not give them any more money wherever it is listed."

• Candy Valentino, 12:30: "Building wealth is a long-term play. So if you do it, do it consistently, do it often, and it's virtually guaranteed throughout your lifetime to go up, to go down. But at the end, compound interest will always win."

Final Thoughts

This episode serves as a crucial warning against the allure of sudden financial gains through unverified and hype-driven investments. Candy Valentino effectively educates her audience on the intricacies of modern investment scams, particularly within the cryptocurrency landscape, and empowers them with the knowledge to protect their financial well-being.

For more insights and actionable advice, listeners are encouraged to follow Candy Valentino on her social media platforms and subscribe to her YouTube channel. Additionally, Candy promotes her latest book, The 9% Edge: Life Changing Secrets, offering further resources to enhance financial literacy and investment strategies.

Follow Candy Valentino:

• Social Media: @candyvalentino
• YouTube: Candy Valentino Show
• Book: The 9% Edge: Life Changing Secrets available on Amazon, Barnes & Noble, and local bookstores.
• Website: 9%edge.com