The Commission would like to alert the public to the existence of bodies
claiming to be independent financial services regulators but which may, in
fact, be used to add legitimacy to questionable and on occasion
fraudulent financial service practices
It has received several enquiries from investors, who upon seeking to
confirm the credentials of "cold callers", have been referred to websites
purportedly operated by a financial services regulator.
The Commission has established that, in a number of instances, such
"regulators" are not recognised by any government, national or international
body and are of questionable validity. Indeed it appears that they may
sometimes have been established by the cold calling firms themselves. As
such these bodies may help create a false sense of security to investors who
may have initially been reluctant to respond to investment opportunities
offered by "cold callers".
In one instance, the telephone number used by the cold-calling firm and
the "regulator" was identical.
We therefore urge the public to always verify the bona fides of entities
claiming to be regulators.
There is no publicly available, global, definitive list of financial
services regulators. However certain basic checks may assist in
verification.
Normally, financial services regulators will have been empowered by
legislation. Investors should ask for a copy, or references to such
legislation from the government of the jurisdiction concerned.
In Gibraltar, for example, the Financial Services Commission was
established by the Financial Services Commission Act. You may verify
this by visiting
http://www.gibraltarlaws.gov.gi.
Checks should also be made with the regulator in the customer's own
jurisdiction. Regulators maintain contacts with each other and should be
able to ascertain the bona fides of a particular regulator relatively
quickly.
In addition, certain international organisations, such as the
International Association of Insurance
Supervisors (IAIS), or the International
Organization of Securities Commissions (IOSCO), provide lists of their
member regulators on their websites. Not all legitimate regulators are
members of such organisations (or all such organisations), however they do
present a helpful guide.