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Boiler room scam busted

A successful crackdown on 'boiler rooms' has been completed, the BBC reports.

The Financial Services Authority (FSA) said that £1 million of losses have now been recovered for 153 Britons, who fell for the share-selling scams.

Boiler rooms operate through selling unauthorised stocks and shares from overseas through cold-calling.

These are often essentially worthless, as well as restricted for onward sales.

In this case, a Canadian firm illegally sold shares in the Rocky Mountain Gold Mining Corporation and the Rocky Mountain Gold Mining Inc.

Jonathan Phelan, head of the FSA's enforcement division, commented: "This is a rare bit of good news for investors who have been persuaded to hand over money to boiler rooms, as usually the money disappears without a trace."

Canadian law enforcement authorities say that around 90 per cent of the money lost to the illegal operation has been recovered.

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