Warning to shareholders against investor fraud (’boiler room fraud’)
Investors should be vigilant to and wary of potential share scams targeted at shareholders in Irish and other public companies.
HOW THE SCAMS OPERATE
These so called “boiler room scams” are operated by fraudsters who contact investors unexpectedly and offer to buy their shares at prices higher than current market value, having obtained investor information and contact details from publicly available shareholder lists. While cold-calling by phone is the most common form of contact they may also use email, post or face-to-face contact, such as approaching investors at seminars.
These individuals often use high pressure sales tactics, telling investors they need to make a quick decision or miss out on a deal offering a large return on their investment. The offer to purchase shares will typically come with a request for bank details or money upfront as a bond or other form of security, with the assurance of a refund if the sale does not go ahead. Once this money and/or information has changed hands, investors are unlikely ever to hear from the scammers again.
WHAT TO DO IF YOU’RE CONTACTED
If you receive an unsolicited call or other approach from someone offering to buy your shares you should:
Take a note of the name of the person and organisation that has contacted you.
Do not provide bank details or arrange money transfers if you have any reservations about the caller.
Check if the company or individual is appropriately authorised to operate as an investment firm in Ireland by the Central Bank of Ireland, or the Financial Conduct Authority (FCA). The list of authorised investment firms is available at the following address – http://registers.centralbank.ie/ or http://www.fca.org.uk/register/.
A list of unauthorised firms that the Central Bank has issued Warning Notices on and a form to report a suspected unauthorised firm is also available, on the following link, https://www.centralbank.ie/regulation/how-we-regulate/authorisation/unauthorised-firms. Alternatively investors may contact the Central Bank on +353 (0)1 224 4000, or the FCA on 0800 111 6768.
- Obtain independent advice from a qualified advisor or stockbroker
- Report any unsolicited approaches in relation to your shares to the company’s registrar
REMEMBER: IF IT SOUNDS TOO GOOD TO BE TRUE, IT PROBABLY IS!