Boiler room fraudsters are contacting consumers posing as a County Durham-based advisory firm, which is the latest victim of the growing spectre of so-called ‘clone firm’ scams.
According to an alert published last week by the regulator, a London-based boiler room is contacting customers from an email address claiming to be adviser DG Financial Services Limited.
The Financial Conduct Authority said the real firm, which is based in Birchley, Chester-le-Street and has been authorised since March 2002 according to the FCA register, has no affiliation with the clone.
The alert was one of two against London boiler room clones issued last week, the second of which warned against a scam using the name of investment firm LBV Asset Management LLP.
The real firm, which is also based in London but out of a different address to that given to ‘clients’ targeted by the scammers, has been authorised since July 2008 and has permissions to trade contracts for difference and other derivatives and holds client money.
On its own website, the real LBV has posted a disclaimer warning prospective clients against the scam and saying it takes no responsibility for whatever comes of doing business with the clone firm.
Clone firm frauds appear to be on the rise, with the FCA warning late last year that the second half of 2013 had seen a spirraling in the number of complaints.
Already this year another financial adviser has been targeted by fraudsters, with Scottish adviser firm d2 Financial Services, based in Paisley, Renfrewshire, being the subject of an alert published earlier this month.
In addition, last week FTAdviser sister paper Financial Adviser revealed Chelsea Financial Services had informed the FCA of a cloned firm which is cold-calling members of the public using its name.
In a warning to its customers and potential investors, posted on Chelsea’s website at the end of December, the firm warned that individuals claiming to be representatives of ‘Chelsea Financial’ are offering investment propositions and asking people to send them money.
Separately last week, the FCA also warned against Jarvis Cohen Associates, a London firm which the regulator believes is targeting UK consumers despite being unauthorised to do so.
Customers who do business with unauthorised firms will have no recourse to the Financial Services Compensation Scheme or Financial Ombudsman Service should they feel misled or deceived, the regulator has warned.