Shareholders should be very wary of any unsolicited advice, offers to buy shares at a discount or offers of free company reports on the Company.
Share scams are usually run from ‘boiler rooms’ where fraudsters cold-call investors offering to sell them what often turn out to be worthless, overpriced or even non-existent shares. While they promise high returns, those who invest usually end up losing their money.
Fraudsters can be very persistent and extremely persuasive when tempting investors into scams. You will often be told that you need to make a quick decision or miss out on the deal. The high-pressure sales tactics can come by telephone, email, post or at a seminar; and it is not just the novice investor that has been duped in this way, as even seasoned investors have been caught out.
Companies have become aware that their shareholders have received unsolicited phone calls or correspondence concerning investment matters which imply a connection to the company. You are strongly advised to deal only with financial services firms that are authorised by the Financial Conduct Authority (FCA), which are unlikely to contact you out of the blue.
If you suspect you have been approached by fraudsters, please contact the FCA using the share fraud reporting form.
You can also call the FCA Helpline on +44 (0)800 111 6768.
If you have already paid money to share fraudsters, you should contact Action Fraud on +44 (0)300 123 2040 or via the Action Fraud website.
If you deal with an unauthorised firm, you would not be eligible to receive payment under the Financial Services Compensation Scheme.
Remember: if it sounds too good to be true, it probably is.