Consumers are warned to always double check credentials of FSPs
Some claiming to be financial service providers are not, such as Eskie Lerrocks and a ‘double your money’ investment firm
Unscrupulous companies are tricking consumers into believing they are authorised to handle money and conduct financial advice, the Financial Sector Conduct Authority (FSCA) has warned.
Naming perpetrators, the FSCA said the companies that are acting fraudulently are using financial service provider (FSP) numbers belonging to unsuspecting FSPs to directly dupe the public in parting with their hard-earned cash. Consumers are, therefore, urged to always double check credentials.
According to the FSCA, CKM Trading Solutions is trading with an FSP number belonging to IG Markets SA. IG Markets has confirmed there is no relationship between the two companies.
Express Cash Investments, which promises to “double your money” in its Facebook adverts, is illegally using the FSP number belonging to Express Well Financial Solutions. The latter has “confirmed with the FSCA that it has neither an association nor dealings” with the fraudulent company.
FSPs receive a number when they are authorised and deemed fit and proper to conduct financial services.
“To purport to be authorised when one is not, is a contravention of the Financial Advisory and Intermediary Services Act and such cases are referred to the South African Police Service for further investigations,” Manasse Malimabe of the FSCA’s investigation and enforcement division told Money.
In the case of CKM, its owner, Bellingham Booysen, “opens accounts on behalf of people with the JSE without their consent”, the FSCA has cautioned, while Express Cash Investments “advertises a ‘double your money investment opportunity’ on Facebook and is collecting money from members of the public with a promise of a substantial return on investment”.
The FSCA also warned the public about NGR Trading, where a man called Eskie Lerrocks purports to be an FSP, financial adviser, wealth manager and forex mentor; and Financial Group House Direct, which offers to turn R500 into R17,000 within six months.
Malimabe said consumers must phone the FSCA or check the FSCA’s website to verify the authenticity of licensed entities as well as the products they are authorised to sell.
The toll-free number is 0800 110 443 and the website is www.fsca.co.za.