ASIC has urged Australian investors to beware of scammers posing as overseas stockbrokers and investment managers following a tricky new innovation to a familiar ‘cold calling’ investment scam.
‘Cold calling is simply a sales call out of the blue. Cold calling investment scams generally involve overseas organisations posing as large brokers or investment managers offering Australian investors shares in offshore companies trading in foreign markets,’ said ASIC’s Deputy Executive Director of Consumer Protection, Ms Delia Rickard.
Ms Rickard said the new scam, run by a fake overseas broking company, was particularly worrying for investors.
‘The scam involves the company offering to carry out off-market purchases of shares for their 'client' and is deliberately targeted at Australians who have foreign holdings in worthless stock from the ‘Tech crash’ of the early 90s.
‘The most worrying development is that more and more of these scams are being committed by sophisticated crime gangs who ask investors to send money, and in some cases, personal information such as bank account or passport details,’ she said.
In another recent variation on this scam, unlicensed overseas organisations advise Australian investors that international company shares have been discovered in their name and that offshore investors are eager to buy them. In order to complete the sale, investors are asked for an upfront fee – often several thousands of dollars – to remove various restrictions on the sale of the shares.
‘These scams are an elaborate trap for unsuspecting investors. An unsolicited offer to purchase your foreign stock from an offshore broker, at any time, should set off alarm bells,’ Ms Rickard said.
‘You are the frontline defence against these calls, and the best protection against scammers is to hang up,’ she added.
‘If you want to buy overseas shares, deal only with brokers who hold an Australian financial services licence.’
ASIC is keen to hear from anyone who has been approached by someone they suspect is posing as an international broker or investment house.
To report a financial scam or to find out whether a company is licensed in Australia, visit ASIC’s consumer website FIDO. Read ASIC’s cold calling tips at www.fido.gov.au/coldcalling to find out more about cold calling phone scams and how to avoid them.
Alternatively, call the ASIC Infoline on 1300 300 630 or email infoline@asic.gov.au.
Background
Cold calling scams are one of the scams in the sights of the Australasian Consumer Fraud Taskforce. Established in March 2005, the Taskforce comprises 18 government regulatory agencies and departments in Australia and New Zealand who have a remit for consumer protection in relation to frauds and scams.
Agencies participating in the Taskforce are:
Australian Government: Attorney General’s Department; Australian Bureau of Statistics; Australian Communications and Media Authority; Australian Competition & Consumer Commission; Australian Federal Police (represented by the Australian High Tech Crime Centre); Australian Institute of Criminology; Australian Securities & Investment Commission; Department of Communications, Information Technology & the Arts.
New Zealand Government: NZ Commerce Commission; Ministry of Consumer Affairs.
State and Territory Governments: Australian Capital Territory – Office of Fair Trading; Consumer Affairs Victoria; New South Wales – Office of Fair Trading; Northern Territory – Department of Justice; Queensland – Department of Tourism, Fair Trading and Wine Industry Development; South Australia – Office of Consumer & Business Affairs; Tasmania – Office of Consumer Affairs & Fair Trading; Western Australia – Department of Consumer & Employment Protection.
Taskforce partners: Taskforce members are joined in communicating with Australian consumers about scams by a range of community, non-Government and private sector organisations. Visit www.scamwatch.gov.au for a list of Taskforce partners.