Three men have been sentenced to a combined nine years’ imprisonment after targeting British people in a scam to sell worthless shares from their Spain-based operation.
The men used high-pressure sales techniques in order to sell worthless share bonds in Chinese commodities firms. They phoned potential investors in the United Kingdom, pretending they were establishing European-based subsidiaries of large Chinese commodity firms.
These subsidiaries were in fact non-trading shell companies and had no link to the Chinese companies. Victims who paid money to this boiler room operation thought they were funding commercial activities; in fact the money was used to support the lavish lifestyles of the fraudsters. Their fraud earned them £1.3 million.
These fraudsters claimed they were based in Canary Wharf in London, but the address given to investors was fictitious and boiler room employees were based in an office in Barcelona. The fraudsters also had mail directed to a mailbox in Haringey in London, and had calls to London telephone numbers redirected to Barcelona. The boiler room also regularly changed its name.
Protect yourself from boiler room fraud
Anyone potentially interested in investing some of their money in shares is being urged to use cases such as these as an important reminder to be vigilant about frauds that could take place.
- If you’re considering any type of investment, always remember: if it seems too good to be true, then it probably is. High returns can only be achieved with high risk.
- If you’re suspicious about a scheme’s authenticity, you should investigate the company’s status and contact details.
- The Financial Services Authority regulates stockbrokers based in the UK. You can check a stockbroker’s authenticity by visiting the FSA’s:
Read more about this boiler room fraud case on the Serious Fraud Office’s website.
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To report a fraud, call Action Fraud on 0300 123 2040 or use our online reporting tool.