If it sounds too good to be true....it probably is!
We, and other companies, are aware that some shareholders have received unsolicited phone calls or correspondence concerning investment matters which imply a connection to the company concerned. These are typically from overseas based ‘brokers' who target UK shareholders. Two common approaches are;
(i) the caller is offering shares for sale, which often turn out to be worthless or high risk in US or UK investments;
(ii) the individual is advised that there is an imminent offer from the company they hold shares in, and the caller is offering to buy their shares at a price significantly above the current market rate. This may involve the payment of an ‘administration fee', or transferring the shares to the caller company.
These operations are commonly known as ‘boiler rooms'. The ‘brokers' (callers) can be very persistent and extremely persuasive. They often have websites to support their activities their advice and the companies they purport to represent. A 2006 survey by the Financial Services Authority (FSA) reported that the average amount lost by an investor is around £20,000.
It is not just the novice investor that has been duped in this way, many of the victims have been successfully investing for several years. Shareholders are cautioned to be very wary of any unsolicited advice, offers to buy shares at a discount, sell your shares at a premium or offers of free company reports.
The callers obtain your details from the Company Share Register. This is a publicly available document, so it is relatively easy for someone to access your name and address. They then look to other sources of information, such as the various directory enquiry services to obtain your phone number.
If you are contacted:
- Make sure you get the correct name of the person and organisation and make a record of any other information they give you. e.g. telephone number, address, web address;
- If you receive telephone calls, emails, letters purporting to be from M&S or from companies endorsed by M&S and you are unsure if they are legitimate, please contact our shareholder helpline for clarification (0345 609 0810);
- If the caller persists, hang up;
- Report the matter to the Financial Services Authority
Details of any share dealing facilities that the company endorses will be included in company mailings.
The Financial Conduct Authority
The FCA can be contacted in respect of unauthorised firms by completing an online form available by clicking on the link below, or by calling 0845 606 1234.
If you deal with an unauthorised firm, you will not be eligible to receive payment under the Financial Services Compensation Scheme.
FCA Online reporting form
Want to find out more?
More detailed information on this or similar activity can be found at www.cityoflondon.police.uk/citypolice within the Economic Crime section.