This week’s post is a collection of investment fraud warnings from regulatory authorities in Canada and the United Kingdom.
Investment Fraud video from the UK
As you may already know, we are running a province-wide Be Fraud Aware campaign that aims to raise awareness of investment fraud and encourage reporting to the BCSC. We’ve heard many good things from people around the province about the campaign, so we thought it would be a good idea to share a video from a similar campaign running in the United Kingdom.
ActionFraud, the United Kingdom’s national fraud reporting centre, released “The Devil’s in their Details – Risky Man” in partnership with the Financial Services Authority, and Financial Fraud Action UK. The YouTube video follows a young man who is listening to an investment pitch over the phone. In it, he exhibits all kinds of risky behaviour while he is on the phone listening to an investment pitch that he hasn’t researched. The video does a great job of delivering the message that if you don’t check into who is selling you an investment or what the investment is, you are taking too big a risk.
BCSC Investment Caution List
BCSC staff added two more companies to the Investment Caution List before yearend.
Flag Resources (1985) Limited was put on the list after the BCSC issued an Investor Alert warning investors not to purchase shares of the cease traded company.
Strategic Global Investments (a.k.a SGI Traders SA) is now on the list after the company solicited a BC resident to open a commodity trading account to invest in gold options. SGI claims to be a commodity and forex broker that provides trading and advising services.
SGI is not registered in British Columbia to trade in, or advise on, securities and exchange contracts. We urge BC residents to exercise extreme caution when dealing with firms that are not registered to trade or advise in the province.
OSC Investor News: High-yield Investment Programs
The Ontario Securities Commission (OSC) recently warned investors that High-yield Investment Programs (HYIPs) are Ponzi schemes. The alert points out that HYIP websites offer unusually high rates of return in today’s low-rate environment. It goes on to say that investing in an HYIP will likely result in the loss of all your invested funds.
In February 2010, the BCSC permanently banned Genius Funds (a.k.a. Genius Investments) from selling securities and engaging in investor relations. At the time, we published a series of blogs on Genius Funds and HYIPs. You will find the series in our Investor Communications section. The documents detailing our enforcement action are there as well.
OSC Investor Alert: Emerging World Pharma, Inc.
The OSC also issued an Investor Alert warning investors to exercise caution if they had any dealings with Emerging World Pharma, Inc. The company’s shares traded on the U.S. over-the-market until the Securities and Exchange Commission suspended trading on Dec. 6, 2012.
Currently, OTCMarkets.com rates the company as “Buyer Beware” and is no longer displaying quotes for the security.
In December 2013, the BC Securities Commission issued two settlements, three notices of hearing, and announced a Supreme Court of Canada decision upholding a commission panel’s decision. The Investment Industry Regulatory Organization of Canada (IIROC) released one settlement in December 2013 relating to a BC resident. The Mutual Fund Dealers Association did not release any […]
The last couple of days of media coverage make you believe that maybe there is a Ponzi scheme epidemic going on in North America. Take these three items. Earl Jones sentenced to 11 years Globe and Mail Pigeon Fever Morley Safer on 60 Minutes Mensch next door charged with Ponzi scheming: printer and master pianist suspected of $27 […]