Martin Lee @ Sg
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Boiler Room Fraudsters Taken to Task

Seven men who were involved in a boiler room scam that cheated investors of millions of dollars over a two year span were sentenced to a total of forty years in jail.

The Spanish-based operation targeted thousands of investors in the UK by applying high pressure telemarketing techniques to push shares in a bio-diesel company, Worldwide Bio Refineries (WBR).

The modus operandi was similar to other scams that tries to sell fake shares through telemarketing like Nexus Ventures.

WBR itself was a shell company that was set up to look like a legitimate business. However, it did had a plant in Singapore producing diesel intended to be marketed in the UK.

One of the men who was convicted, Dennis Potter, lived in Singapore during the time the scam was ongoing in 2005 and 2006.

Nothing was mentioned in the SFO report about whether the money was ultimately recovered, but seeing how the money was systematically transferred to offshore accounts, I am not optimistic.

With an average of 5-6 years in jail (even less after parole), the fraudsters might not need to work for the rest of their lives after being released if they had managed to stash away their money safely before their arrest.

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Leave a Comment:

4 comments
sender says 12 years ago

hi Martin,

been waiting to ask this question for quite sometimes and happens you mentioned it here. What does “boiler room” fraudster means?

Also, i come across another term called “boiler-plate” clause. What is “boiler-plate” clause?

Hope to learn something new. Thanks.

Reply
    Martin Lee says 12 years ago

    Dear Sender,

    wikipedia is your friend. 🙂

    http://en.wikipedia.org/wiki/Boiler_room_(business)

    Not too applicable on boiler plate.

    http://en.wikipedia.org/wiki/Boilerplate_(text)

    Reply
      sender says 12 years ago

      from wiki, boiler room sounds like telemarketing salespeople

      while boiler plate somewhat akin to standard legal language used in most financial brochures.

      is my interpretation correct?

      Reply
        Martin Lee says 12 years ago

        The telemarketing salespeople part is correct as that is how the scammers get their victims. Through the phone.

        boiler-plate is new to me too so I can’t really comment.

        Reply
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