Scam victims to be reunited with cash
Around £270,000 recovered from a boiler-room scam is to be returned to victims in full, the financial watchdog has said.
The Financial Services Authority (FSA) has recovered the money as a result of action taken against companies involved in a share fraud activity.
The scam saw members of the public cold-called from overseas by individuals and encouraged to buy shares in a company called Eduvest. Despite being promised significant returns on their investment, the shares were worthless – leaving investors out of pocket.
The scammers tried to legitimizs the scam by saying they worked for the following brokers: Rothman Capital; Bishop Capital; Bernam Shore; and Investor Relations Corp.
Police raided three premises in London and Southend last November – resulting in the arrest of one individual. At the same time, the FSA served injunctions freezing assets of up to £350,000 and restrained the illegal activities of the businesses and individuals involved.
No one has been charged in connection with the scam at this stage, and the FSA’s investigation is on-going.
"We are extremely pleased to be able to recover and return money to investors who have been persuaded to hand over their money as part of a share fraud scam,” says Margaret Cole, director of enforcement and financial crime at the FSA.
“Such good news is rare for victims who deal with unauthorised firms, as the money usually disappears without a trace.”
The Financial Services Authority is an independent non-governmental body, given a wide range of rule-making, investigatory and enforcement powers in order to meet its four statutory objectives: market confidence (maintaining confidence in the UK financial system), financial stability, consumer protection and the reduction of financial crime. The FSA receives no government funding and is funded entirely by the firms it regulates, but is accountable to the Treasury and, ultimately, parliament.