The Financial Conduct Authority (FCA) is taking action to prevent scams in the consumer investment sector after it stopped one in four firms from entering the market.
The regulatory body received 16,400 enquires about possible scams, up nearly a third from the same period in 2020 between April and September last year.
The top types of scams reported included cryptoasset, boiler room and recovery room swindles.
The latest data shows a quarter of applications from firms wanting to join the consumer investment market are being stopped by the FCA – up from one in five in the last financial year.
Nine of the firms prevented from gaining authorisation were because the individuals involved were responsible for giving unsuitable advice before trying to avoid the consequences of their actions by moving to or setting up new firms.
Other individuals set up and sought authorisation for a new firm before their existing firm started to receive complaints about poor past advice.
Now the FCA has released data on the most common scams – and what it is doing to protect consumers.
Sarah Pritchard, Executive Director of Markets at the FCA said: “Consumers need to have confidence when making investment decisions and the data we’ve published today shows how prevalent scams can be.
“Before investing, check you know who you are really dealing with, check if they are authorised by the FCA and do your research to understand the risks that might be posed.”
