Money
Managing your money
Beware the boiler-room scams
Share sale crooks ooze charm on the phone – then run off with your cash, writes Paul Lewis
The biggest threat to the finances of Middle England – that's how Det Chief Supt Steve Wilmott describes a con called the boiler-room scam.
He estimates that £500 million a year is stolen from unsuspecting victims in the UK. The losses range from a few thousand pounds to more than a million. And if you think that you could never be conned, DCS Wilmott has this warning for Saga readers.
"They are hugely persuasive, very sophisticated. We've had professors, doctors, local councillors – even financial advisers being caught."
The crooks get names and addresses of people who already own shares – that information is publicly available – and telephone them at home out of the blue. The caller will be British and well spoken and offer a deal on shares in a new company that is involved in something that you know is cutting edge such as DNA profiling, mining for rare metals, a new drug for cancer, or prospecting for oil. The patter will be smooth and the offer tempting, says Wilmott.
"These people are very knowledgeable; they have glossy – but fake – websites. Sometimes they refer you to a false regulator who seems to authenticate them. One lady came to us because her husband had committed suicide after losing £225,000. Another lady had power of attorney when her husband fell ill and then she lost £500,000."
Once you show any interest the callers will be persistent, cajoling, persuading, even threatening. If you send them money, fake share certificates will arrive. But then they will be back with tales of takeovers and the urgent need to invest more to make more. And if you decide to sell your shares they will agree – but charge you an upfront commission. And never send you any money.
"We've known them strip out life savings. My aim is to eradicate these crooks. If someone calls up to offer you shares over the telephone just put the phone down. It's that simple."
DCS Wilmott has caught some of these crooks and even got back a little money. But he is eager to collect as much information as he can. If you have been conned or approached – or even bought shares this way – call him on 020 7601 2222 or visit www.cityoflondon.police.uk/citypolice/ and click on Fraud Advice (Boiler Room-Archway).
* Written by Paul Lewis. Paul's opinions are his own and for general information only. Always seek independent financial advice.
* This article first appeared in the August 2008 edition of Saga Magazine.
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