Financial Fraud rises but the Fight-back also continues

The consequences of Covid-19 appear to have played a significant part in the escalation of financial fraud which causes very real harm to the victims. Many people working in affected industry sectors such as hospitality and tourism that have been decimated by the measures taken to control coronavirus pandemic are now facing a bleak future having been made redundant with little prospect of finding similar employment in the present climate. Financial fraudsters are fully aware that such individuals are vulnerable to “get-rich-quick” scams and deliberately entice them into the consumer investment market with highly improbable promises of high-level returns on investment that the unwitting novice investor is unaware cannot possibly be met.

Joanna Bailey, an associate in Giambrone’s financial and banking litigation team, points out “The Financial Conduct Authority (FCA) receives an ever-growing number of complaints from investors which arise from brokers that operate outside their regulatory perimeter. Others like Rodeler Ltd. who traded as 24 Option, who use the “passporting” system to avoid the scrutiny of regulating authorities” she went on to say “the fight against fraud continues but we are seeing an intensive effort on the part of the fraudsters to draw novice investors into bogus high-risk investments (that would be hazardous even if they were genuine) where they cannot possibly recognise the danger.”

The FCA has received 24,000 reports of unauthorised activity in 2020 and refused authorisation to 343 applications and revoked 131 authorisations, including that of Rodeler Ltd. trading as 24 Option, in an attempt to curb the rising financial fraud and protect novice investors that lose money that they simply cannot afford to lose. Despite the 47 enforcement investigations issued by the FCA against unauthorised businesses in 2020 together with fines of £80 million fines delivered to regulated firms and individuals for breach of the rules during the course of 2019 and 2020, the fraudsters are brazen enough to continue. The experienced lawyers in Giambrone’s financial and banking litigation team believe that a considerably more robust approach and a concerted effort to clarify the “grey” areas and close the loopholes that exist at present, together will a high level campaign to inform and warn potential investors on how to recognise and avoid scams would assist in the fight to prevent financial fraud.

Our lawyers strongly advise anyone contacted “out-of-the-blue” and offered a high return investment opportunity or who sees an advert on social media offering a similar opportunity should think very carefully before getting involved. The very least you should do is visit the FCA’s scam smart page and check the unauthorised firms' listings. The skilled lawyers Giambrone’s financial and banking litigation team have had some significant successes when obtaining the return of lost funds and have developed some novel strategies that have proved to be extremely effective, it is still far better to avoid the potential to be defrauded.

If you suspect that you have been scammed or you broker is evasive when you attempt to withdraw your funds contact Giambrone’s financial and banking litigation team for advice and assistance.

For further information about retrieving lost investment funds please click here.