One of the largest global stock market scams in Australian history is quashed after investors were defrauded of more than $1 billion
- International stock scam scammed victims
- It brought ‘financial ruin to Australian victims’
A multinational stock market scam has come down after residents around the world, including Australia, were scammed out of more than $1 billion.
The “boiler room” scam – so named because it involves high-pressure tactics – used a series of bogus stock trading firms to steal people’s unsuspecting savings.
Some had been active since 2008 and brought ‘the financial ruin of Australia’s victims’.
A massive multinational stock market scam that swindled victims, including an estimated hundreds of Australians, out of more than $1 billion has been quashed
The operation, reportedly led by British man Peg Leg, was revealed after a lengthy international investigation.
Several Australians had been conned, prompting them to contact NSW-based private investigator and cybercrime investigator Ken Gamble.
He launched a global investigation that led to the con artists being caught – in dramatic raids involving dozens of armed officers.
Gamble’s company IFW Global represents 20 people from NSW, Victoria, Queensland and WA who lost a combined $63 million, but the total number of Australian casualties is much higher.
“This criminal group has left a path of destruction and financial ruin for the Australian victims,” Gamble said 7News in the spotlight.
These alleged fraudsters claimed to work for major financial advisory firms in Southeast Asian countries such as Hong Kong, Japan and Korea.
“But they were in secret offices in Malaysia selling non-existent stocks using high pressure sales techniques and cleverly crafted sales scripts to defraud investors.”
A victim told the program she felt “such an idiot” after being involved in the brutal robbery.
Gamble said it was “one of the most sophisticated and established scam syndicates we’ve seen in many years.”
The syndicate’s leader, a British alleged con artist known as Peg Leg, and more than 80 others have been arrested, with 24 offices and homes of prime suspects raided.
Police seized more than $4.3 million in cash.
After using Internet search terms such as ‘investment opportunities’, victims were duped by what they believed to be respected stockbrokers with legitimate-looking, but bogus, websites.
The criminals had even managed to get their fabricated press releases to the attention of some online news outlets who hadn’t bothered to check if they were legit.
Money from the Aussie victims was sent to so-called ‘transfer agents’ and ‘escrow accounts’ in Hong Kong, but efforts to get the banks there to intervene have come to nothing.
The accounts were controlled by Chinese criminals using hundreds of “money mules” who traveled from Hong Kong to open accounts.
The money was then laundered through bank accounts in Thailand and Singapore and massive amounts of cash were then brought across the country’s borders to Malaysia.
The alleged criminals (some of whom are pictured above) were exposed when victims from across Australia contacted NSW-based private investigator and cybercrime investigator Ken Gamble
Private investigator Ken Gamble said it was “one of the most sophisticated and established scam syndicates we’ve seen in many years.” The photo shows some of the alleged criminals
A tip from Mr Gamble led to the Malaysian Anti-Corruption Commission (MACC) launching Operation Tropicana and conducting months of undercover work.
IFW also collected more intelligence and shared it with the MACC.
Direct police involvement was avoided as the criminals were believed to have connections to current and former senior officers.
The scam was blown wide open when MACC agents, along with Mr Gamble, launched a raid seizing customer lists, computers, mobile phones, sales scripts, financial documents and cash.
How the international scam syndicate worked to scam Aussies
The alleged fraud against Australian victims involved alleged investment brokers soliciting investment in IPOs (initial public offerings of shares) and other securities.
The scammers placed advertisements on Facebook and created websites and promotional materials to attract investors to learn how to buy shares in multinational companies.
The alleged fraudsters operated dozens of professional websites and self-published major international headlines to boost the reputation of their bogus virtual companies, which would often last no more than three months before being shut down and then reopened under a different name .
The group is accused of laundering billions of dollars in Malaysia from hundreds of different bank accounts in Hong Kong.
Nearly all victims who were tricked into paying for shares or investing in IPOs were told to send their money to transfer agents and escrow accounts in Hong Kong.
But these accounts were run by a sophisticated Chinese money laundering syndicate using hundreds of “money mules” from mainland China.
Source: IFW worldwide