Sharon Bowles MEP warns South East investors of new 'boiler room' fraud threat (Gravesham and Dartford Liberal Democrats)

Gravesham and Dartford Liberal Democrats <membership@libdems.org.uk>

Sharon Bowles MEP warns South East investors of new 'boiler room' fraud threat

May 24, 2010 1:00 PM
Originally published by Sharon Bowles MEP

Sharon voting in the European Parliament

Lib Dem MEP Sharon Bowles is warning people in the South East of a new 'boiler room' threat, the biggest yet uncovered by the Financial Services Authority.

A list, discovered by the FSA last week and containing the names and addresses of over 38,000 people, many of whom live in the South East, is still believed to be in active use.

Hubs of illegal business activity, often dubbed 'boiler rooms', have appeared across Europe in recent years, selling fake or worthless shares to unsuspecting investors over the phone.

Sharon has pressured the European Commission to take action against Spain for not implementing the Markets in Financial Instruments Directive, legislation which, properly applied, would prohibit 'boiler rooms' from being set up.

Countries are often reluctant to spend money tracking down fraudsters when the victims are in other countries. Nevertheless, pressure on Spain has started to bear fruit.

Danish national, Thomas Knudsen, 31, was arrested on a European arrest warrant by Spanish police in Malaga last March and extradited to the UK where he was found guilty of conspiracy to defraud and laundering more than £2,100,000.

Sharon said:

"Boiler room fraud ruins lives, robbing hard-working people of their savings. Worryingly, the list recovered by the FSA last week contains a high concentration of names and addresses in the South East.

"I am pleased the FSA has taken immediate action to inform those on the list but I am also keen to publicise this issue and boiler room scams in general, so that people can be on their guard, especially if business is done over the phone.

The FSA is in the process of writing to every person on the list warning them of the scam.

ENDS