Boiler room fraud
What it is and how to recognise it?
You suddenly get a phone call, chat or email offering you a wonderful opportunity to invest in shares, bonds, crypto or real estate. What do they promise? A fast, substantial return on your investment. But... they say you have to act fast. The scammer knows a lot about you and seems trustworthy. Is this a genuine investment opportunity? Find out how you can protect yourself and your money from this type of investment fraud.
How the scammers operate
The investment opportunity in a case of boiler room fraud may sound very convincing. You’re promised a high return with low risk, but you have to decide quickly. To appear trustworthy, the scammers use professional-looking websites and claim to have an AFM licence. You often start by investing a small amount that earns money quickly, which is how they persuade you to invest more. However, the investment eventually turns out to be fake and all your money is gone.
Want to know more about investment fraud?
Boiler room fraud is a type of investment fraud, which more and more people are falling for. In this webinar, our experts explain how to recognise and avoid investment fraud.
Tips on how to protect yourself and avoid boiler room fraud
- Always check whether the company has an AFM licence or is registered with the Dutch Chamber of Commerce. In the Netherlands, investment service providers must be licensed by the Dutch Authority for the Financial Markets (AFM). Boiler rooms do not have this licence. Also have a look at the international IOSCO listings.
- You are contacted incessantly and pressurised into investing. It’s now or never. This is often a sign that you’re dealing with an investment fraud.
- The offer is too good to be true and you must decide right now. But there’s no such thing as ‘get rich quick’. If something seems too good to be true, it probably is.
- Be careful about sharing personal details on social media. Scammers collect as much information as possible about you, and use it to gain your trust.
- They try to get round the security checks put in place by your own bank. Don’t accept offers like opening a new account for you with a different (foreign) bank.
- Your own bank will ask you questions about unusual transfers if they notice that a transaction deviates from your usual payment pattern. This is one of the ways that the bank tries to protect your money and prevent fraud. If someone tries to tell you how to answer these questions from the bank, you are probably dealing with a scammer.
- A Dutch celebrity is seen promoting a particular investment, but in reality, they’ve never given their permission. The advertisement is fake.
- Take a look at the AFM warning list and the police website to read more tips.
What to do if you fall victim to a scam
- Report it to the police and always notify us about fraud
- Report the fraud to the AFM and the Fraud helpdesk.
- It’s a good idea to get legal advice about what to do next. The Juridisch Loket, is a legal advice organisation, and some law firms specialise in this subject.
- Gather evidence: save any information relating to the boiler room fraud, such as emails, messages and bank statements.
- If you’d like to talk to other people who’ve been affected by scams, Victim Support Netherlands has an online support group (only in Dutch).
