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There has been an increase in reports of threatening and abusive
calls from boiler room staff. The boiler room operative, claiming
to be a genuine broker, claims victims have made a binding ‘Verbal
Contract’ over the telephone and that they have recorded that
‘contract’. Victims are then threatened with anything from
intimidation to legal action.
A significant number of victims are elderly and vulnerable and
have lost their life savings. There has been an increase in boiler
rooms advising victims to re-mortgage their homes. Victims are also
persuaded to cash in life insurance policies or investments and use
credit cards to buy the value-less shares on offer.
There has been an increase in female victims and younger males
indicating that the brokers will approach just about anyone. The
only gender/age group that has yet to be reported as being
approached is the under 50’s females.
Boiler Rooms scripts suggest that the criminals find men are
easier to deal with as ‘women ask too many questions’. This
could explain the smaller number of female victims though research
implies men are more likely to feel shame and not report crimes
than women. Those that have fallen victim to boiler rooms are
predominantly male and aged 50+. They tend to be experienced
investors with a long history of investing. The victims are spread
throughout the UK and come from a variety of backgrounds.
A new technique to gain credibility & seek and promote
ongoing investment from the victim is to stage a shareholders
meeting. These are held in large reputable hotels in major cities
such as London an Edinburgh.
Previously, investors were instructed by the Boiler Rooms to
send money to accounts based overseas. However, we are receiving
more and more reports of British bank accounts being used to
validate the appearance of the transactions.
Early identification, freezing accounts and intervention have
proven to be very successful and over £900,000 has been recovered
for investors by the City of London Police in the last five
The Operation Archway team meet regularly with banks to share
intelligence, this has helped investors receive back thousands of
pounds of otherwise lost savings.
The banks are increasingly intervening to protect their
investors’ money. One major UK high street bank estimates that in
the past 2 years it has intervened to save investors more than four
million pounds which would otherwise have gone to a boiler
Using the Operation Archway database and the FSA’s own extensive
victim details has provided an effective profile of the victim.
This profile has been provided to the banks assisting them to focus
on the type of account holder that is most frequently targeted by
the boiler rooms. This collaborative activity has proved to be
highly effective in returning investors otherwise lost funds.
Boiler rooms rely on recruiting often naïve young people to be
the frontline of their sales team. These people are tempted by the
offer of a ‘high returns sales job in the sun’.
Officers recognized boiler rooms were targeting students and
attended The Universities Careers Advisors Group conference to
offer advice. Warnings have since been placed on University
recruitment web pages and a number of referrals have been made to
the police about existing advertisements and attempts to place new
The Archway team is liaising with major recruitment companies to
update them on boiler room operations and recruitment