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Beware of imposters

DREYFUS Securities in Bangkok sounds like a very plausible name for a securities dealer, doesn’t it?

So thought the winner of the February Gull of the Month award on the Australian Sec-urities and Investments Com-mission.

He received a phone call from someone overseas who said that they represented Dreyfus Sec-urities and offered him a chance to invest some money.

A few days later he received a glossy brochure. Soon there-after, a further phone call from Dreyfus Securities ensued.

In that call the representative of Dreyfus Securities proceed-ed to provide a half hour or more of heavy sales pitch for a hi-tech Canadian stock, at a discount to the market rate, with protection against any currency losses.

The representative ended the sales pitch by offering to purchase 2500 shares and then fax the information on the stock and its potential and would then ring on the following Monday to finalise everything.

At no time did the winner actually place an order or agree to the buy order.

Fortunately, the winner spoke to a friend of his who advised him to go to the ASIC website and view the FIDO investor pages.

The FIDO pages have a section devoted entirely to cold-calling.

One of the featured comp-anies on that site was none other than Dreyfus Securities.

As ASIC’s Director of Communication, Dr Michael Dunn says: “This experience is typical.

“Overseas operators set themselves up with respectable sounding names, often similar to well respected investment companies, and pressure Aust-ralians into sending them money for hot stocks and dodgy investments. If you want to invest overseas, use a licensed Australian stockbroker or financial adviser.

“That way you get the protection of Australian law. Once you start using unlicensed overseas operators, you can kiss your money goodbye.”

As we have often indicated in this column, the ASIC has a very important publication for potential investors.

The publication entitled Don’t Kiss your Money Goodbye sets out the questions that investors need to ask their advisers and covers such issues as licensing, education, remuneration, exp-erience, research sources and other similar information.

Additionally, the ASIC website at www.fido.asic.gov.au will provide information about overseas unlicensed brokers who have cold-called Aust-ralians to part with their hard-earned money.

The ASIC is also always looking for other similar arrangements that we may have come into contact with.

Their website at www.asic. gov.au provides information as to how to advise them.

But the most important tenet that we can derive from the story of Dreyfus Securities is that we need to be very careful as to the advice we seek.

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