Thursday 22 February 2007 LAWFUEL – Law News, Australia Business & Law – The Australian Securities and Investments Commission (ASIC) announced today that three people involved in an international investment fraud against Australian investors had been arrested in Malaysia, as part of an international investigation led by the Dubai Financial Services Authority (DFSA), in cooperation with other international regulators. Although the full extent of international investor loss is unknown at this stage, the amount is estimated at USD$600,000.
Australians were among those around the world cold called by representatives of a fictitious London firm called Cambridge Capital Trading to persuade them into investing money in offshore options trading. The fraudsters had set up fake websites called the Dubai Options Exchange, a fake regulator called the United Arab Emirates Commodity Futures Board and Cambridge Capital Trading that claimed to offer financial services within the Dubai International Financial Centre. To further disguise the scam, electronic answering devices, a phoney facsimile and false billing addresses for the websites were set up in Dubai, the UK and the USA.
‘ASIC greatly appreciates the strong action taken by overseas regulators to combat this sophisticated scam that targeted Australians’, Mr Greg Tanzer, Executive Director, Consumer Protection said. ‘ASIC also thanks those Australians who contacted ASIC and gave us information that helped overseas regulators take action. If anyone has lost money through the activities of Cambridge Capital Trading , I urge them to contact us.’
The arrests follow injunctions obtained by the DFSA on 15 February 2007 to close down the ficticious websites. The DFSA obtained civil court orders against certain individuals and entities for their involvement in this internet investment scheme. The Malaysian Securities Commission had arrested three individuals, freezing funds amounting to USD$ 350,000 in a bank account linked to the fraudsters. Australians warned ‘Despite these arrests, Australians need to stay on guard against cold calling investment scams’, Mr Tanzer said. ‘Make sure anyone who calls you with an investment offer or advice holds an Australian financial services licence. You can check licences free on our consumer website FIDO at www.fido.gov.au.’
‘Lately, some fraudsters have been pretending to hold licences or to be authorised to represent licensees. If you get a call out of the blue from someone you don’t know, the safest thing to do is to hang up and call them back on the number listed in the phone directory. Report any suspicious approaches to ASIC.’ ‘Once money is sent offshore, it can be very difficult to trace or recover. If you deal with a genuinely licensed Australian financial services business, you’re better protected if something goes wrong’, Mr Tanzer added.
Background Cold calling is a sales call or offer that is received out of the blue. These scams usually involve overseas organisations claiming to be large brokers or investment managers offering Australian investors shares in offshore companies or investment schemes that trade in foreign markets. The best protection against these scams is to hang up immediately. Check the register of licensed financial service providers online, at ASIC’s website www.asic.gov.au, or call the ASIC Infoline on 1300 300 630.
To find out more about cold calling scams and how to avoid them, read ASIC’s cold calling tips. ASIC’s consumer website, www.fido.gov.au, maintains a blacklist of known cold calling organisations, however names used by these fraudsters change constantly. Complaints regarding investment scams may be lodged via ASIC’s website or by writing to any of our capital city offices across Australia at: Manager National Assessment & Action ASIC GPO Box 9827 Melbourne VIC 3001 Links to the DFSA website for further information: http://www.complinet.com/dfsa/display/display.html?rbid=1547&record_id=15831http://www.complinet.com/dfsa/display/display.html?rbid=1547&record_id=15833 For further information contact: Mr Greg Tanzer Executive Director, Consumer Protection Telephone: 07 3867 4704 Mobile: 0411 549 144 Danielle Huck ASIC Media Unit Telephone: 03 9280 3407 Mobile: 0417 540 769