The FCA and US counterpart the Securities and Exchange Commission have warned that a fake regulator is being used by scammers to convince customers to hand over money.
The pair have warned that a pretend agency called the Federal Financial Regulatory Board, based in Boston, is actually being promoted by so-called “boiler room” fraudsters to help them sell investments.
“Boiler rooms are referring consumers to this fake regulator to legitimise requests for funds” the FCA says in its note today. The SEC had already issued its own warning.
Boiler rooms are scams run from a location where cold-callers group to offer suspect investments to the public, which promise huge returns, but investors are left out of pocket when the investments turn out to be worthless, overpriced, or even non-existent.
Fraudsters in the UK have repeatedly used the names of prominent agencies like the Financial Services Compensation Scheme, Pension Wise, and the FCA itself to add weigh to their pitches.
Asset managers like BlackRock and Rathbones have also seen their firms cloned by scammers.