New Zealanders have lost millions of dollars over the phone to international share scams.
These conmen are persuasive. And persistent
Typically they say that a company is poised to make an exciting breakthrough with new technology or a medical discovery. Its shares are listed on an American stock exchange but the company is little known and the shares are very cheap. Buy now, before the breakthrough announcement, and you'll make a huge return.
The callers are persistent, often calling back many times. They may become abusive if you try to fob them off.
They target people throughout the country, particularly small business owners.
Many people have fallen victim to these bogus share deals. After they send the money they find that either no shares are bought, or that the shares are worthless and can't be sold. The "broker" then becomes difficult if not impossible to contact.
After a time the victim gets another telephone call, from an apparently new "broker" who has a buyer for the worthless shares or who will swap them for more valuable shares.
Again the message is very convincing. In the hope of recovering some of their lost money people fall for the new scam. They are talked into sending more money to pay a "transaction fee" or a "registration fee" before the deal can be done. This money too is lost.
Sometimes the follow up call is from a bogus lawyer who offers to help the victim recover their money. Again, of course, they must send money before the "lawyer" can assist. This is also a scam.
These callers may refer you to an impressive-looking website as proof that they are genuine. Investigations show that these sites have seldom been in existence for more than a few weeks.
Frequently the caller give the number of an official sounding agency in the United States for you to verify that the broker is genuine. If you ring the number your call will be answered by the fraudsters who will of course say that the broker is legitimate. The "official agency" they referred you to does not exist.
These international fraudsters regularly change their names, their websites, and the countries from which they operate to avoid detection - and to keep the money rolling in.
If you wish to buy shares in overseas companies seek advice from a New Zealand share broker who is accountable under New Zealand law.
Don't be a gullible kiwi:
www.sharescams.org.nz
List of overseas firms that telephone New Zealanders
www.sharescams.org.nz
For more information about investment scams go to:
Slam the phone on share scams
Don't engage with the caller. They will use all their skills to persuade you to part with your money. The best option is to hang up every time they call.
Do not send any money
It is extremely unwise to send money overseas on the basis of a telephone call from a stranger.
Once money is sent out of the country it is impossible to trace. Money sent overseas to these firms will never be recovered.
Check our list...
The Securities Commission has a list of overseas firms who have telephoned New Zealanders with bogus share offers.
We publish their names to warn people not to do business with them. The list is at www.sharescams.org.nz
...but beware
These fraudsters change their names often. If a caller is not listed on our website it does not mean that they are genuine. If they call out of the blue and use the tactics described above, do not do business with them.
Slam the phone on share scams
See these at www.seccom.govt.nz
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The Securities Commission is New Zealand’s main investment regulator. Our job is to build confidence in New Zealand’s investment markets.
Disclaimer
This leaflet is for general guidance only. If you are in doubt or
would like definitive information you should seek
professional advice.