Here are ten top tips to avoid falling prey to fraudulent and unauthorised financial services companies...
A flurry of warnings from the new financial services regulator, the FCA, in the past week about unauthorised financial services firms is a sure-fire sign it intends to stick to its 'consumer first' promise.
There are of course plenty of unauthorised firms that are running scams; recently, many have come from overseas companies targeting UK consumers.
The important thing to remember is that if you deal with an unauthorised firm - whether they are running a scam or not - you will not be covered by the Financial Ombudsman Service (FOS) or Financial Services Compensation Scheme (FSCS) if things go wrong.
However, there are plenty of steps you can take to protect yourself from fraud and unauthorised activity. The FCA offers the following tips:
Step 1: Check the Register
It strongly advises you to only deal with financial services firms that are authorised or registered. Check the FCA Register to ensure they are. The Register has information on firms and individual that are, or have been, regulated by the regulator.
If a firm does not appear on our Register but claims it does, contact the Consumer Helpline on 0800 111 6768.
Step 2: Ring them back
To confirm the identity of an authorised firm on the Register, ask for their ‘firm reference number' (FRN) and contact details, but always call them back on the switchboard number given on the Register rather than a direct line they might give you.
Step 3: Use the right website
You should access the Register from- www.fca.org.uk - rather than through links in emails or on the website of a firm offering you an investment.
Also check the address of the website is correct and there are not subtle changes that mean it is a fake.
Step 4: Beware of cloned firms
You should also beware of fraudsters pretending to be from a firm authorised by the FCA, as it could be what is known as a 'cloned firm'.
These scammers often claim to be from overseas firms that appear on the Register as these firms do not always have their full contact and website details listed.
Step 5: Make additional checks
With fraudsters adapting their tactics you should make additional checks to confirm you are dealing with the financial services firm in question and have the correct contact details - especially if you have been cold-called.
You might want to check the details on the firm's website, with directory enquiries or Companies House.
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