Belgium’s Financial Services and Markets Authority (FSMA) issued on Wednesday a warning regarding the increased activity of boiler and recovery rooms in the country by entities unauthorized to target local citizens.
The regulator published the names of 11 entities that act as investment firms or credit institutions, but have not been authorized to do so. They mainly target company managers and directors. Following is the full list of unauthorized entities that the FSMA warned about:
- Alfa One Corporation, The Southwood Group and Micron Associates
- Apex Equities, South-East Asia Traders and South-East Asia Registrar
- Asia Pacific Brokerage Services Ltd.
- Bow Financial
- Earnest & Medwell International
- Fuji Credit Asset Management (Fuji Credit J-LLC)
- Gemini Acquisitions and Escrow Service Group
- Gerard & Alterman (G&A) (cloned firm)
- Hoover Bright Independent Finance Advisor and CC Manuel Trading
- Mitsui Credit Global (Mitsui Credits), Resona Corporate Partners, Franklin Transfer Services, Ming Fu (HK) Industrial Ltd., EKL International CO., Ltd., Hadid Ravan CO., Ltd. and Bauway Technology Ltd.
- Nippon Holdings (Nippon Capital Asset Management), Osaka Financial, Franklin Transfer Services, Able Century Ltd. and Glory Jet Ltd.
In boiler room schemes, fraudsters contact customers, often by phone, and offer to sell them questionable or exotic financial products. They present themselves as being authorized and eligible businesses, when in fact they offer fictitious or worthless products. Investors are promised high profits and lured into depositing a certain amount after which they receive a fast profit. However, soon after, fraudsters ask for additional investments which end up being losing ones. In order to get their money back, investors are asked, often through pressure, to make further payments.
Recovery room frauds refer to a practice where fraudsters contact victims of an earlier fraud, again by phone, to offer them assistance in recovering their losses. Investors are required to pay fees, which, however, are lost and do not result in getting their money back.
The FSMA gave several advices as to how to prevent frauds, including looking up its list with authorized entities and warning list. The regulator issues warning notices on a regular basis, with which investors should refrain from engaging.