The Alberta Securities Commission (ASC) is warning Alberta investors of a ‘recovery room’ scheme that is targeting Morgan Dragon Development Corp. investors.
Recovery room schemes typically involve companies that contact investors, who have money tied up in an illiquid investment, with an offer to buy their shares at an inflated price. Once investors agree to the deal, the operators of the scheme ask the investor to first pay a fee for the service/transaction. In reality, the operators keep the fee but do not repurchase the shares, effectively victimizing the investors a second time.
The ASC has been alerted that G.W. Trust and Transfer Services Limited, purportedly operating out of Thailand, is contacting MDDC investors and offering to buy their company shares. As part of the pitch, investors are told this is a limited-time offer and that before receiving any money from the purchase, the investor must first pay a “non-resident tax” based on a percentage of the inflated share price, usually in the thousands of dollars.
The ASC is cautioning MDDC investors against participating in the offer or sending money to this company.
The ASC says there are a number of red flags that lead the ASC to believe this is a recovery room scheme, such as: unrealistically high returns; money sent offshore; money must be paid up front; pressure to act quickly; and spelling errors in the documents related to the offer.
Anyone who has been approached with an offer by a company offering to purchase MDDC securities is asked to contact the ASC Public Inquiries at <a data-cke-saved-href=”mailto:The Alberta Securities Commission (ASC) is warning Alberta investors of a ‘recovery room’ scheme that is targeting Morgan Dragon Development Corp. investors. Recovery room schemes typically involve companies that contact investors, who have money tied up in an illiquid investment, with an offer to buy their shares at an inflated price. Once investors agree to the deal, the operators of the scheme ask the investor to first pay a fee for the service/transaction. In reality, the operators keep the fee but do not repurchase the shares, effectively victimizing the investors a second time. The ASC has been alerted that G.W. Trust and Transfer Services Limited, purportedly operating out of Thailand, is contacting MDDC investors and offering to buy their company shares. As part of the pitch, investors are told this is a limited-time offer and that before receiving any money from the purchase, the investor must first pay a ” href=”mailto:The Alberta Securities Commission (ASC) is warning Alberta investors of a ‘recovery room’ scheme that is targeting Morgan Dragon Development Corp. investors. Recovery room schemes typically involve companies that contact investors, who have money tied up in an illiquid investment, with an offer to buy their shares at an inflated price. Once investors agree to the deal, the operators of the scheme ask the investor to first pay a fee for the service/transaction. In reality, the operators keep the fee but do not repurchase the shares, effectively victimizing the investors a second time. The ASC has been alerted that G.W. Trust and Transfer Services Limited, purportedly operating out of Thailand, is contacting MDDC investors and offering to buy their company shares. As part of the pitch, investors are told this is a limited-time offer and that before receiving any money from the purchase, the investor must first pay a ” non-resident=”” tax”=”” based=”” on=”” a=”” percentage=”” of=”” the=”” inflated=”” share=”” price,=”” usually=”” in=”” thousands=”” dollars.=”” asc=”” is=”” cautioning=”” mddc=”” investors=”” against=”” participating=”” offer=”” or=”” sending=”” money=”” to=”” this=”” company.=”” says=”” there=”” are=”” number=”” red=”” flags=”” that=”” lead=”” believe=”” recovery=”” room=”” scheme,=”” such=”” as:=”” unrealistically=”” high=”” returns;=”” sent=”” offshore;=”” must=”” be=”” paid=”” up=”” front;=”” pressure=”” act=”” quickly;=”” and=”” spelling=”” errors=”” documents=”” related=”” offer.=”” anyone=”” who=”” has=”” been=”” approached=”” with=”” an=”” by=”” company=”” offering=”” purchase=”” securities=”” asked=”” contact=”” public=”” inquiries=”” at=”” inquiries@asc.ca.=”” previously=”” banned=”” from=”” trading=”” purchasing=”” securities,=”” using=”” any=”” registration=”” exemption=”” contained=”” alberta=”” laws=”” until=”” april=”” 2018.?subject=”ASC%20Public%20Inquiries"”>inquiries@asc.ca</a>.</p> <p> The ASC previously banned MDDC from trading in or purchasing securities, and from using any registration exemption contained in Alberta securities laws until April 2018.</p><p></p>