Boiler room fraud
If someone tries to sell you an investment over the phone or by email, simply refuse, as there’s a good chance that you’ll lose a lot of money. We explain how boiler room fraud (a type of investment fraud) works. You can also read how to recognise this type of fraud.
Boiler room fraud
How boiler room fraud works
Boiler room fraud (a type of investment fraud) is when someone tries to sell you an investment over the phone or by email. The caller obtained your details when you entered them (possibly unwittingly) online, perhaps when you viewed a (fake) advertisement for a good investment proposal on a website or Facebook. The caller will often be a foreigner, and may say that he or she is licensed by the Dutch Authority for the Financial Markets (AFM).
You’re promised fast returns. The caller will also try to get you to make a decision right away. If you accept the offer, you will be given a registration form to start by investing a small amount of money. You might indeed make a profit on your first investment.
But as you start to invest more money, the value of your investments keeps going down and that is the last you will see of your money.
Recognising boiler room fraud
Fraudsters employ a number of tricks when they contact you. Make sure you recognise these tricks and never let anyone persuade you to invest money just like that.
Trick 1: the ‘Dutch celebrity’ trick
A Dutch celebrity supposedly sings the praises of an investment in an online advertisement. But this has been done without the celebrity's consent. The advertisement is fake.
Trick 2: The ‘now or never’ trick
If you leave your details after reading the online advertisement, it won’t be long before someone contacts you by phone or email. You will be pressured into making an investment.
Trick 3: the ‘AFM licence’ trick
The caller says that he works under an AFM licence. This is how the fraudster tries to gain your confidence.
Trick 4: The ‘don't you want to get rich?’ trick
If you express any doubts, the caller will ask if you don’t want to get rich. Unfortunately, there is no such thing as ‘getting rich quick’. If the returns seem too good to be true, they probably are. Keep a cool head and look out for the tricks.
What to do if you fall victim to boiler room fraud
You can report potential boiler room fraud to the AFM (in Dutch). Your report may prompt them to open an investigation. We also advise you to report the matter to the police.
We recommend seeking legal advice about what you can do next. Legal advice organisation Het Juridisch Loket (in Dutch) can help you further, and there may also be law firms that specialise in this subject.
We recommend seeking legal advice about what you can do next. Legal advice organisation Het Juridisch Loket (in Dutch) can help you further, and there may also be law firms that specialise in this subject.