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Scammers send out emails to consumers with links to the websites of real companies in order to build trust.
British consumers lost 78 million pounds ($109 million) to so-called "clone firms" last year, as financial problems linked to the pandemic convinced many to make rash investments. As reported by representatives of the Financial Services Authority (FCA) In the UK, consumers lose an average of 45 thousand pounds due to fraudsters posing as legitimate investment companies.
Clone firms are fake organizations created by fraudsters that use the name, address, and unique Firm Reference Number (FRN) of legitimate companies regulated by the FCA.
Fraudsters send e-mails to consumers with links to the websites of real companies in order to increase the credibility of their actions.
However, the FCA stresses that even the most experienced investor can be at risk. Three-quarters (75%) of investors have assured the FCA that they can detect fraud, but even more (77%) do not know or are not sure what a "clone investment firm"is. The regulator urged all potential investors to check the firm's information on the FCA register and use the phone number listed there to double-check any information.
Although 38% of investors said they would verify the unique FRN ID, verification alone is not enough. Fraudsters often copy FRN numbers and encourage victims to check the FCA register to prove their legitimacy.
British consumers lost 78 million pounds ($109 million) to so-called "clone firms" last year, as financial problems linked to the pandemic convinced many to make rash investments. As reported by representatives of the Financial Services Authority (FCA) In the UK, consumers lose an average of 45 thousand pounds due to fraudsters posing as legitimate investment companies.
Clone firms are fake organizations created by fraudsters that use the name, address, and unique Firm Reference Number (FRN) of legitimate companies regulated by the FCA.
Fraudsters send e-mails to consumers with links to the websites of real companies in order to increase the credibility of their actions.
However, the FCA stresses that even the most experienced investor can be at risk. Three-quarters (75%) of investors have assured the FCA that they can detect fraud, but even more (77%) do not know or are not sure what a "clone investment firm"is. The regulator urged all potential investors to check the firm's information on the FCA register and use the phone number listed there to double-check any information.
Although 38% of investors said they would verify the unique FRN ID, verification alone is not enough. Fraudsters often copy FRN numbers and encourage victims to check the FCA register to prove their legitimacy.