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FCA Figures Reveal Unauthorised Firms Cloning Concerns

Number Of Reports To Regulator ‘Double Between September And October’


The Financial Conduct Authority (FCA) has seen an increase in the number of companies which have been affected by potential cloning scams, according to reports.

FTAdviser.com writes that the number of reports of cloned companies doubled between September and October to reach 33, with the number of companies which the reports relate to also increasing from six to 10.

The figures mark a significant increase from January, when 22 reports were received with them relating to just two companies.

According to FTAdviser.com, such cloning schemes see companies use the registration numbers of authorised schemes to pose as them and encourage investors to hand over funds. Companies including Axa and Skandia are thought to be among those which have faced issues in recent months.

The release of the figures has come after statistics from the Financial Conduct Authority revealed the number of consumer complaints reported by financial services firms fell by 500,000 in the first half of 2013 to reach a total of 2.9 million.

Expert Opinion
It is very worrying to see these figures emerge, particularly to see increases in the number of issues being raised in recent months, possibly through more sophisticated ways for a clone to pose as an authorised firm.

"Such findings indicate that there remains much to be done to tackle the issue of cloning and ensure that investors, consumers and others are protected from the risks of giving funds to unauthorised operations.

"If you are cold called, you have to be very vigilant that you are dealing with an FCA authorised firm. Unfortunately it can be elderly consumers who fall prey to unauthorised firms and it can be difficult to get their money back."
Sarah Wallace, Partner