The FSA says it received nearly three times as many reports about cloned firms in 2011 compared with the previous year.
Cloned firms appear to be genuine authorised firms or individuals when in fact they are a separate company with no affiliation to the firm they are cloning.
In 2011, there were 449 reports made about cloned firms compared to 161 in 2010.
The FSA has reported a 19 per cent increase in ‘boiler room’ fraud enquiries in 2011 compared with 2010, however less people invested in such scams compared to the previous year.
Enquiries about share fraud rose from 4,527 in 2010 to 5,401 in 2011 while there was a 7 per cent drop, from 831 to 770, in the number of people reporting they invested in such schemes.
FSA head of unauthorised business Jonathan Phelan says: “A 7 per cent drop in the number of investors might seem small, but in this case it represents 61 people. Our research shows that the average investor loses around £20,000, so it is possible that around a million pounds in consumer losses may have been prevented.”