Mark Spiers, who responded to yet another FCA warning on the presence of fraudsters who use details of authorised firms to convince people they are authentic, said a couple of simple checks can help advisers avoid being scammed.
According to Mr Spiers, who is a compliance specialist, most fraud is internet-driven and can be stopped by locating a suspicious website, obtaining its IP address and then calling the internet service provider to get the website in question shut down.
This process, he added, should be repeated regularly to ensure the company’s name does not become potentially tarnished by one of the many scammers lurking on the internet.
He said: “Most fraudsters tend to set up a website based on an existing firm, put in a slightly different phone number and then persuade people to send them money. By using an existing company name the fraudsters can get a bit of credibility.
“Every now and then you should do an internet search. If you find a suspicious website you should then search its IP address, using one of the tools available online, and then call the internet provider listed to get the website closed down.”
Mr Spiers claimed that though most advisers were conscious that fraudsters exist, the majority were not aware of the potential risks that being swindled can have on a company’s name and reputation.
Whereas most assumed this type of activity involved directly stealing money, he explained that a case of a modern-day fraudster stealing another firm’s identity could leave the reputation of a respected firm in tatters.
He added: “Advisers are not necessarily aware of the risk this can have to their reputation. If someone uses your name your reputation could get shot.”
Although far less common, Mr Spiers also discussed the occasional cases in which fraudsters sought to take over smaller businesses by gaining access to Companies House accounts.
Even though Companies House has cracked down on this, he said it was still possible for fraudsters to access the account, add a couple of directors and then proceed to change the company’s registered address.
Chris Clark, managing director of Clark Marketing, said: “I worked with Regulatory Legal, now Risk Warning, on winning redress for many Arch Cru clients and we continue to work on campaigns. In the case of rogue IFA websites – clones or otherwise – the first thing to consider is why they are there. With some exceptions, it is likely they are there as a back check and reference for a fraudulent organisation seeking to scam by email, phone, or possibly post. The obvious step to me is to require IFAs to be required not to publish their IFA approval number, but instead to simply say that they are FCA approved.”