City of London Police break-up international boiler room fraud

City of London Police has released details of a major fraud investigation that led to 13 people being arrested over the Christmas period in a co-ordinated national and international police operation.

Eleven people in Northumbria, one in Manchester and one in Sweden were arrested on suspicion of a number of fraud related offences in connection to a boiler room fraud worth in excess of £20 million.

On December 30th twenty officers from the National Lead Force for fraud were assisted by Northumbria Police in targeting nine homes across the county. Warrants were later executed on properties in Manchester.

On the same day a 28-year-old man was arrested in Sweden on suspicion of conspiracy to defraud and conspiracy to money launder. He remains in custody pending extradition proceedings. All twelve people arrested in the UK have since been released on police bail pending further inquiries.

The investigation has focused around BFS Corporation, a company with a registered address in Mayfair but which never traded.

Police believe hundreds of people have been conned into investing in BFS Corporation with the promise of significant returns on their money.

Officers have since seized assets and frozen bank accounts, and are in the process of restraining properties and sports cars in the UK and abroad.

Detective Chief Superintendent Steve Head, from the City of London Police Economic Crime Directorate, said:“We believe this to be one of Europe’s largest boiler room frauds, with hundreds of people having lost a combined total that runs into millions of pounds.
“By working in close collaboration with police forces across the UK and in several European countries we have gone a long way to dismantling this complex and highly damaging criminal operation and seizing the criminal proceeds.”

Boiler room frauds happen when people are cold-called in their homes by fraudsters posing as financial brokers and asked to buy shares at inflated prices or in fictitious companies.

They are promised massive returns and sent share certificates as proof of their investments.

Once a payment has been made the fraudsters, often operating from Spain, will call back again and again in an attempt to sell more worthless shares.

Personal details are also sold on to other criminals, who will then approach the victim with a different offer but the same criminal objective. 

 Det Ch Supt Steve Head added:“What initially seems like a great opportunity presented by a respectable financial broker can end up with life savings being lost and lives being destroyed.

“These are ruthless criminals who will do whatever it takes to get hold of people’s money. But as this investigation shows, wherever they are believed to be operating we will come and get them, be it in this country or abroad.

“I would advise anyone who is contacted over the phone and offered the opportunity to invest in a company to do their research and think long and hard before parting with their money.

“Once you have opened the door to boiler room fraudsters things can turn very nasty very quickly.”

If you would like to pass on information to police relating to this investigation you can email: OpSoundwave@cityoflondon.pnn.police.uk

For further information please contact City of London Police Press Office on 020 7601 2015, or email media@cityoflondon.police.uk