We know all about high-level perpetrators of of securities frauds. Plenty of attention has been placed on the Ken Lays of this world.

But little attention has been given to the scam-meisters who sell bogus stock on the Internet, the ones behind those "pump and dump" schemes. And the unscrupulous who prey on the elderly, the naive and the greedy with their "risk-free" investment opportunities, promising them that they will double their money overnight.

This problem is not going away. In fact, technology and a liquid market means it's getting worse. Getting some insights into what makes these scam artists tick might actually help regulators deal with them more effectively.

Law professor Jayne W Barnard argues that the US Government handles these people with kid gloves. The existing enforcement structure designed to deter them is based almost entirely on civil remedies such as fines, injunctions and occupational bars. Only rarely, are they prosecuted criminally.

In her paper, Securities Fraud Professionals, Barnard argues that perpetrators of these schemes are a breed apart and many of them suffer from Antisocial Personality Disorder, a condition that has several criteria: failure to conform to social norms with respect to lawful behaviors; deceitfulness, where basically they can't lie straight in bed; consistent irresponsibility so they have trouble turning up to work or honoring financial obligations and finally, a lack of remorse or sense of guilt.

She says they are more than just liars and thieves, they are also white collar criminals. And con artists, she says, have a special toolkit: intellectual agility which gives them the ability to construct a plausible "fraud script" for them to target the victim, build rapport, set the hook, extract the cash, put the cash out of reach and then take steps to avoid detection, and still have the agility to shift ideas quickly when circumstances change; skills at deception which give them the ability to read the mind of the victim, and regulate their own emotions so they don't appear nervous; they have to be cool under pressure; they need the business savvy so they can describe why their start-up company or scheme will work where others have failed; they need to be credible, and to project trustworthiness; they should also have a total lack of empathy and remorse and they need to be fairly savvy about the Internet.

Barnard says that hitting these people with civil penalties will not solve the problem because most of them are committed recidivists. And that group, she says, are like sex offenders: they're "hard-wired" to rip people off.

She suggests five ways to deal with them:

1. Bring in a "one-bite" rule: you can fine them the first time around, but if they show up again, you refer the matter to the Department of Justice for criminal prosecution.

2. The Securities and Exchange Commission sets up a Recidivist Task Force.

3. Monitor defendants after their first offense.

4. Put them on a securities fraud registry so that potential investors can look them up.

5. More research into them, even sending in psychologists to give them diagnostic tests and giving them brains scans.

Some of Barnard's suggestions seem over the top, but clearly, there is a problem. Whatever the regulators are doing now is not solving it.