Beware of Share Fraud
Warning to shareholders
Beware of share fraud
Some companies are aware that shareholders have received unsolicited phone calls or correspondence concerning investment matters which imply a connection to the company concerned. 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. Shareholders may also be advised that there is an imminent offer for the company, and the caller may offer to buy shares at significantly above the market price if an administration fee is paid. This is known as ‘boiler room fraud’.
They can be very persistent and extremely persuasive and the Financial Conduct Authority (FCA) has reported that the average amount lost by each investor is around £20,000. It is not just the novice investor that has been duped in this way; many of the victims had been successfully investing for several years. Shareholders are advised to be very wary of any unsolicited advice or offer to buy shares at a discount.
How to avoid share fraud
Any correspondence purporting to be from London Stock Exchange Group (LSEG) soliciting you to buy shares in a specific security will not have come from LSEG and should be considered a scam. LSEG does not provide any mobile trading application(s). Any mobile trading application(s) purporting to be from LSEG, offering the ability to buy or sell securities should also be considered a scam.
Financial Conduct Authority (FCA) Beware of Share Fraud document - it contains practical advice for those approached by boiler rooms in a variety of guises and a list of 10 guidance points.
If you are approached by fraudsters please tell the FCA using the share fraud reporting form at www.fca.org.uk/scams where you can find out more about investment scams.
You can also call the FCA Consumer Helpline on 0800 111 6768.
Investment scams are designed to look like genuine investments
Spot the warning signs:
Have you been....
- contacted out of the blue
- promised tempting returns and told the investment is safe
- called repeatedly, e-mailed by an unknown third party, provided links to non-verified websites or applications, or
- told the offer is only available for a limited time?
If so, you might have been contacted by fraudsters.
See the FCA Be ScamSmart document on how to avoid share fraud and how to report a scam.