Belgium’s FSMA alerts of potential boiler room frauds

Belgium’s FSMA alerts of potential boiler room frauds

Belgium FSMA

Belgium’s Financial Services and Markets Authority (FSMA) has issued a warning against several entities that operate unauthorized and that may be boiler-room frauds. The entities are targeting and contacting Belgium citizens in an attempt to get them to invest their money. They appear to be targeting company managers and directors in particular.

The list of companies is as follows:

  • Aichi BMO International (ABMOI) / Leiyu Trade Ltd. / GHY Partners Ltd.
  • Apex Alliance
  • Citic Tokyo International / Bai Xin Cheng Ltd. / Jin Yam (HK) Trade Co. Ltd.
  • Drukenmiller Investment Services / Timmermans Asia Ltd / Hansen Peters Ltd. / Sarandon Asia Ltd.
  • Lexus Group / MCA Advisors / Raeat Holdings Ltd.
  • Sino Link Japan / Mypal International Co. Ltd. / Bai Xin Cheng Ltd. 
  • West Pacific Dealers

“[…] the FSMA strongly advises against responding to any offers of financial services made by the companies listed above and against transferring money to any account number they might mention,” the watchdog said in a statement.

In boiler room schemes, fraudsters contact customers, often by phone, and offer to sell them financial products that may appear genuine, but are in fact fictitious or worthless. Investors are promised high profits and lured into depositing a certain amount after which they receive a fast profit. Such companies present themselves as being authorized and eligible businesses with a professional website and forms to fill out. However, soon after fraudsters ask for additional investments which the client looses. In order to get their money back, investors are asked, often through pressure, to make further payments if they want to access their funds.

“Fraudsters running such operations often do not hesitate to put the consumer under severe pressure (hence the term “boiler room”),” the FSMA noted.

The Belgian regulatory shared several things investors can consider before engaging with a financial service provider, in order to protect themselves from becoming fraud victims. Here they are:

  • always verify the identity of the firm
  • consult the warnings published on the FSMA website and on the website of foreign supervisory authorities
  • check whether the firm holds an authorization
  • be wary of unsolicited phone calls/emails (cold calling)
  • be wary of requests to transfer money to a State without any connection to the company or with the State of which the investor is resident
  • be wary of (promises of) completely disproportionate returns
  • not accept uncritically the information provided by such companies
  • ask their intermediary for clear and comprehensible information
  • be all the more suspicious if the firm makes the pay-out of returns conditional on an additional payment and/or the payment of a tax

 

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