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Scam watch: the share-buying phone scam

Well-informed fraudsters are targeting investors in a seemingly sophisticated share scam. Here’s how one Which? member was almost caught out by a share-buying telephone scam.

11/11/2019: Shareholders persistently targeted

We’ve noticed a spike in shareholders persistently being targeted by this scam, which we first reported back in 2014.

Comments such as this one have become a regular occurrence here on Which? Conversation:

A member of the public also got in contact with Which? Money recently when they were phoned out of the blue by a company named ‘Sunburst Consulting Group’.

It knew about some worthless shares they had in a telecoms firm, but told them they were worth £40,000 and that they’d found a private buyer – they even sent a contract for the ‘sale’.

This contract included a non-disclosure agreement and wanted them to buy an ‘insurance bond’ for £3,750.

At this point, they were right to become concerned and break off contact. It seems likely that if they’d paid the ‘bond’, their money would have disappeared, along with the ‘buyer’.

We tried to contact Sunburst Consulting Group via email, but it bounced back.

Scammers often target those who have stakes in defunct firms, or ones that have been taken over.

Any claims that your shares can be purchased for far more than their usual value should immediately raise suspicions. If you need help getting your money back after a scam, visit our guide.

Have you been targeted by a share-buying scam? Continue to let us know and warn others in the comments.

24/11/2014: Original Convo

By Joe Elvin

The Which? member told us: I have been the target of an international telephone share scam involving a fictitious hostile takeover. The caller knew my full name and that I had purchased shares in a certain company back in 2001.

He claimed I had a registered holding of ‘incentive shares’ in this company, credited because I was a long-term shareholder, and that he was representing a client that wished to mount a hostile takeover of this company.

He asked if I would be willing to sell my shares at between £10 and £15 per share, which I said that I would be willing to do.

I was soon contacted by another client who told me that the sale and purchase would proceed via a ‘transfer agent’, but part of the transaction involved an insurance bond by both parties where I would need to put up almost £5,000.

I was already suspicious, but at this point I knew the whole deal was fraudulent.

This was a remarkably sophisticated fraud attempt, involving apparently legitimate companies, with company logos, legitimate telephone numbers, and plausible looking web sites. I would like to prevent anyone becoming a victim.

Our say on investment scams

These companies may have put a bit of effort into appearing legitimate, but anyone who calls you out of the blue about an investment opportunity is almost certainly a fraudster.

These scammers are likely to have obtained most of your details from the shareholders’ register.

Those who want to double-check the legitimacy of a financial company should check if it is listed on the FCA’s Financial Services Register.

Anyone who is contacted by an unregulated firm, as you were, should report the companies involved to the FCA and Action Fraud.

Have you been a victim of this scam or a similar one? Do you have any tips for spotting an unregulated firm?

Comments
Simon Blake says:
14 October 2020

I have been contacted by ‘ Jackson Associated in New York ‘ purporting to represent a buyer for British Bio Progress Shares. Same MO in that they wanted an NDA signed and they mentioned an ‘Insurance Bond’ although at that point the value was not discussed.

After several different people rang me I said I believed this was a scam and they quickly got off the line.

This is not the first such approach I have had as a previous scam call involving a bogus Tokyo based company with a similar story regarding Stem Genetics.

Please be wary

AWeir says:
15 October 2020

I’ve had 3 calls over the past week from clairfield consultancy New York. Same ND form to be emailed back , same shares equate to £40000, Told not to tell anyone. I only have 56 shares at .27p each ! also in a leading supermarket chain, they knew how many shares I had, but told me that I actually had over 3000! They slipped up with my name though. The shares I have were never a changed into my married name, and when they called they asked to speak to Mrs Xxxx.
My son in law Put me onto your page. Thanks to him and this page and my 6th sense I’m hopefully saved

NIGEL HUDSON says:
19 October 2020

Add Crumpler Securities to the list – same story – shares in a company I though I had sold. Approximately £40k in value to be crystallised and guess what they want 10% as a bond up front!

Too good to be true!

Definitely a scam.

Watch out for the unpaid interest scam when they say you are owed interest and they can get it for you.