Belgium’s FSMA warns against boiler rooms
The Financial Services and Markets Authority (FSMA) today issued a warning against several companies engaging in unauthorized activities in Belgium.
The companies are the following:
- IWL Consulting (www.iwlconsulting.com)
- May Capital Group (www.maycapitalgroup.com)
- South Pass Partners (www.southpasspartners.com)
The above-mentioned companies are not authorized to provide investment services in Belgium. The FSMA therefore strongly advises against responding to any offer of financial services made by the companies listed above and against transferring money to any account number they might mention.
Moreover, according to information in the possession of the FSMA, these companies may be ‘boiler rooms’.
Boiler room fraud is a type of fraud that generally involves contacting consumers unsolicited, often by telephone, offering to sell them shares or other financial products. Recently, the services being offered have grown ever more diverse. Products and services currently being offered also include: management accounts, term deposit accounts, investment advice, investments in crowdfunding, etc.
Although boiler rooms claim to be authorized service providers, with a professional website and forms to fill out, they are in reality fraudsters who offer fictitious or worthless products or services.
As a rule, the consumer is enticed to make an initial, limited investment that very soon appears to be profitable. After that, the consumer is asked to make more and more additional investments. But when a consumer asks for his or her money back, this proves to be impossible without making additional payments and/or the new investments begin to lose money.
The fraudsters often put the consumer under severe pressure (hence the term ‘boiler room’), insisting that they keep making further payments. In the end, the consumer will never get the invested money back.
Please note that if the FSMA has not published a warning against a given company, this does not mean that that company is authorized to offer financial services. While the FSMA seeks to ensure that it publishes warnings in a timely manner, it is entirely possible that a company operating unlawfully on the Belgian market may not yet have come to its attention. Moreover, unauthorized companies regularly change their name.
Be wary of unsolicited phone calls/emails (cold calling), that is, where no prior request has been made by the investor. Such calls are often indications of an attempt at fraud.