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Experienced investors fall for scams

Middle-aged professional men are the most common victims of “boiler room” investment scams.

A survey of 105 members of the public who called the FSA&#39s consumer helpline after falling victim to investment scams found that the typical victim is a middle-aged professional male with considerable investment experience.

Nearly 90 per cent of victims calling the helpline are male and 44 per cent are aged between 35 to 55.

A further 42 per cent of calls are from people over 55, with 22 per cent from those who are retired.

The survey showed that nearly 30 per cent of callers are professionals or directors. Just over 40 per cent have been investing for over 10 years and only 12 per cent have never made an investment before.

One caller, a management consultant in his 50s who had been investing for 12 years, contacted the FSA after losing almost £40,000 investing in shares through a Japanese “boiler room”.

He said he was caught out at a time when his pension fund and other savings were not doing well and he thought the investment could improve his portfolio. When he tried to access his money at a later date, he could not get hold of any of the people he dealt with and discovered it was a fraud.

FSA director of enforcement Andrew Procter says: “These figures dispel the myth that it is just the novice investor who falls victim to investment scams. It is clear that professionals who have been making investments for many years are also particularly vulnerable. Anyone who is considering making an investment should remember – if it sounds too good to be true, it often is.”

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