A possible “recovery room” scheme may be targeting victims of previous investment frauds, warns the Ontario Securities Commission (OSC).
A company known as PFS Investments Overseas Division (PFSOD) is not registered to sell securities in Ontario, and may be targeting victims of previous schemes, the OSC announced on Tuesday.
The firm should not be confused with PFS Investments Inc., which is a genuine brokerage firm, the OSC notes.
“PFSOD is a Florida company that appears to be targeting Ontario victims of an investment scheme involving First Global Ventures S.A. (FGV).” the OSC warns. The regulator alleges that PFSOD is contacting former FGV investors with offers to purchase their shares in a company called Petromed, or to exchange them for shares in another company.
Earlier the year, the Manitoba Securities Commission (MSC) also issued a warning about PFSOD, noting that it was targeting victims of both FGV and a related boiler room scheme, Maitland Capital.
See: Boiler room victims targeted in follow-up scam: MSC
The MSC warning notes that investors are required to pay an upfront fee before they can receive any money for their shares; and it cited a number of red flags that indicate it is a recovery room scheme, including the fact that it targets past victims of an investment scheme, requests investors’ banking information, and pressures investors to act quickly.
FGV and Maitland have both been permanently cease traded by the securities commissions of Alberta, Manitoba, New Brunswick, Ontario and Saskatchewan. As well, in 2011, an Ontario judge found two men guilty of running a boiler room in connection with Maitland Capital. They were sentenced to 21 months in jail and two years of probation for breaching securities law, and Maitland Capital was also fined $1 million.