Warning to Shareholders
Boiler room scams
Over the last few years many companies have become aware that
their shareholders have received unsolicited phone calls or
correspondence concerning investment matters. These are typically
from overseas based 'brokers' who target UK shareholders offering
to sell them what often turn out to be worthless or high risk
shares in US or UK investments. These operations are commonly known
as ‘boiler rooms’. These ‘brokers’ can be
very persistent and extremely persuasive, and a 2006 survey by the
Financial Services Authority (FSA) has reported that the average
amount lost by investors is around £20,000.
It is not just the novice investor that has been duped in this way; many of the victims had been experienced investors who had been successfully investing for several years. Shareholders are advised to be very wary of any
unsolicited advice, offers to buy shares at a discount or offers of
free company reports.
If you receive any unsolicited investment advice:
- Make sure you get the correct name of the person and
organisation.
- Check that they are properly authorised by the FSA before
getting involved. You can check at
www.fsa.gov.uk/register/.
- Report the matter to the FSA either by calling 0845 606
1234 or visiting
www.moneymadeclear.fsa.gov.uk.
- If the calls persist, hang up.
If you deal with an unauthorised firm, you would not be eligible
to receive payment under the Financial Services Compensation
Scheme. The FSA can be contacted by completing an online form at
www.fsa.gov.uk/pages/doing/regulated/law/alerts/overseas.shtml.
Details of any sharedealing facilities that the company endorses
will be included in company mailings.
More detailed information on this or similar activity can be
found on the FSA website www.fsa.gov.uk/consumer/.