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Watch out for fraudulent wealth management offers, says Belgian regulator

Chris Hamblin, Editor, London, 23 January 2021

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In the past few weeks the Belgian Financial Services and Markets Authority has received new complaints from consumers who have been approached by companies that offer wealth management.

The FSMA is warning consumers against these tempting offers, which fraudsters often make without its permission.

In Belgium, the modus operandi of these fraudsters always remains the same: they 'cold call' victims by telephone or persause them to enter their contact details on online forms. They offer them wealth management services with the promise of returns in excess of those available on the open market returns, most often with capital guarantees thrown in. Ultimately, of course, the victims usually find themselves unable to recover any of their money.

Consumers have recently informed the FSMA of fraudulent activities conducted by:

  • Asse-Groupe (www.asse-groupe.com)
  • Brookfield Investment Fund PLC (https://brookfieldinvestmentfundsplc.net/)
  • Create Capital Invest (www.createcapitalinvest.com)
  • Patrimoine Connect (https://4gste3-12qxt9901mnd.com)
  • Vuelex (https://www.vuelex.com/fr/)

On the subject of how frauds start, the regulator writes: "There are different ways in which scammers may approach you. [It often happens] after having expressed interest in an advertisement on social media or on other websites boasting high interest rates. In the next few days, you will receive a phone call from a telephone salesperson offering you investments."

When the cold call comes, the regulator says: "You will then be invited to check the 'company’s' website and to open a personal account. Sometimes you will also be offered a contract. Contact will subsequently be by e-mail and telephone.

"You may be offered a variety of investments. However, consumers have over the last few months frequently reported being offered wealth management contracts. In essence, you give them your money and they manage it for you, with the promise of high – or even guaranteed – returns. In other cases, consumers are asked to open an account (savings or otherwise), the key again being high – or even guaranteed – returns."

The regulator is urging consumers to avoid falling into the trap by taking a test on its website to weed out fraudulent offers. It says that unauthorised companies are "not uncommon" and that if any such company is located outside the European Union, the consumer in question will struggle to find legal recourse in the event of a dispute. Such companies often change their names. 'Cloned firms' - companies that pass themselves off as existing, lawful companies, seem to be as prevalent in Belgium as elsewhere in Europe. A close look at the email addresses or contact details of the companies in question may prove useful here.

Not only does the FSMA's website contain warnings - so, too, does that of the International Organisation of Securities Commissions or IOSCO. There is, of course, a list of companies operating unlawfully in Belgium on the FSMA website.

On top of these warnings, the FSMA is asking consumers to be wary of requests to pay money into bank accounts in countries that have nothing to do with the companies that are approaching them. It is also suspicious if the payout of returns is conditional on an additional payment and/or the payment of a tax.

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