The Ontario Securities Commission has issued an investor warning about a possible advance fee scheme. In this case, investors in a number of real, but poorly-performing companies were offered premium prices for their shares provided they first sent a fee to cover the transaction.
Advance-fee schemes aim to gather money from investors by promising to buy their illiquid securities for much more than they are currently worth. Once the fee is paid, the investors never receive any money for the securities they agreed to sell.
In this case, investors in Canada, the US, and UK were contacted by callers claiming to work for the OSC, or the US Securities and Exchange Commission, and persuaded to pay up-front fees to bank accounts in Toronto and Hong Kong.
To put a stop to this activity, the OSC issued a temporary cease trade order against Michael Chomica, Peter Kuti, Jan Chomica and Lorne Banks, and companies named Global Consulting and Financial Services, Crown Capital Management Corporation, Canadian Private Audit Service, and Executive Asset Management. A hearing will be held on November 17, 2010.
The OSC warns investors not to send money to these people and companies, or the following: Belmont Group Limited, Chelsea International Consultants, Eurasia Mergers and Acquisitions Registration Authority, Global Capital Group, Global Asset Management, Highgate Consultancy Services, Jermar Inc., Jermar Productions and Macao Management.
For further information, contact the OSC Contact Centre at 1-877-785-1555.
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