Is this a scam?

Wolves51

Hello
I would be grateful for some advice please?
I was looking to transfer £20,000 from a cash isa which is earning a tiny interest rate and found a fixed rate bond - Old Mutual Bond Impala at 6.95% through a broker AEC investments. They contacted me to say that the bond has FSCS protection up to £85,000 and the rate is fixed at 6.95% per annum with unlimited access and no fees to withdraw funds. £19.99 fee to close account. Surely this can’t be genuine???

232607

You’ll find it’s a fixed rate bond so long as the bond issuer remains solvent. If it doesn’t, you have a real possibility of losing 100% of your capital.
The FSCA protection would not return your money in this instance.

Unless you’re ok with the possibility of losing all your investment & it’s only a small % of you portfolio & you’re an experienced investor, you shouldn’t go anywhere near this.

SonOf

and found a fixed rate bond

What you found was not a fixed term deposit but a 100% capital at risk loan note issued on the London Stock Exchnange (ISIN: XS1323982915). If held in isolation of other investments, it is higher risk than investing in a FTSE tracker fund.

https://www.londonstockexchange.com/exchange/prices-and-markets/stocks/summary/company-summary/XS1323982915ZZGBPSTBS.html

They contacted me to say that the bond has FSCS protection up to £85,000 and the rate is fixed at 6.95% per annum with unlimited access and no fees to withdraw funds

it has no FSCS protection.

It was issued in 2015 and can be traded on the markets until redemption in 2025.

It has a current price of 120.06p and will mature at 100p. So, if you held until maturity you would suffer a capital loss.

This is not a retail financial product and should not be marketed as such. Any company presenting this as a fixed term deposit is committing fraud.

AEC investments Ltd is registered at companies house as:
56101 - Licensed restaurants
56102 - Unlicensed restaurants and cafes
56103 - Take-away food shops and mobile food stands

There is no company on the FCA register called AEC investments.

So, my gut feeling on this, based on other similar and common scams, is that they are using a genuine loan note to entice you in but would not actually purchase the loan note but pocket the money and give you fake documentation.

Wolves51

Thank you so much.Very impressive sounding broker and website.
I will definitely avoid
Aec-investments.com

Aretnap

Wolves51 wrote: »

Thank you so much.Very impressive sounding broker and website.
I will definitely avoid
Aec-investments.com

Appears to be the UK arm of a real Italian broker with EEA authorisation

https://register.fca.org.uk/ShPo_FirmDetailsPage?id=001b000000Mfu04AAB

They display this on their home page

Fraud Warning: AEC Investments does not contact members of the public in the United Kingdom offering retail investments, including high yielding bonds

So it sounds like whoever contacted you was someone pretending to be AEC, rather than AEC themselves. In other words, it's a clone scam. Do not touch it with a bargepole.

SonOf

Thank you so much.Very impressive sounding broker and website.
I will definitely avoid
Aec-investments.com

This looks like a cloning scam. Take a genuine company and set up one with a similar name.

Aec-investments.com

That website has a an address of 30 Dukes Place Aldgate London EC3A 7HX UNITED KINGDOM

The FCA register added a warning on their website on 23rd October 2019 that 30 Dukes place was being used for a cloning scam. It also issued a warning in September that the same address was being used for a cloning scam.

Search ec3a 7lp at https://register.fca.org.uk/ShPo_HomePage

It doesnt match AEC but two warnings at the same address in two months using two different names could suggest that they change the firm that they are cloning frequently.

The website you gave the link to has the following information:
Registrar URL: http://www.godaddy.com (would a multi-national company really use go daddy?)
Creation Date: 2019-10-07T06:14:56Z (it was only created less than a month ago)
Registry Expiry Date: 2020-10-07T06:14:56Z (it is only valid for one year - businesses keep them on for many years)
Registrant Organization: Domains By Proxy, LLC
Registrant Street: DomainsByProxy.com
Registrant Street: 14455 N. Hayden Road
Registrant City: Scottsdale
Registrant State/Province: Arizona
Registrant Postal Code: 85260
Registrant Country: US



Everthing about this smells.

colsten

Report it to ActionFraud.

Aretnap

SonOf wrote: »

The website you gave the link to has the following information:
Registrar URL: http://www.godaddy.com (would a multi-national company really use go daddy?)
Creation Date: 2019-10-07T06:14:56Z (it was only created less than a month ago)
Registry Expiry Date: 2020-10-07T06:14:56Z (it is only valid for one year - businesses keep them on for many years)
Registrant Organization: Domains By Proxy, LLC
Registrant Street: DomainsByProxy.com
Registrant Street: 14455 N. Hayden Road
Registrant City: Scottsdale
Registrant State/Province: Arizona
Registrant Postal Code: 85260
Registrant Country: US

You're right, and the contents of the website also smell fishier than Grimsby. It doesn't disclose the actual identity of the company behind it (I had to go digging for the FRN which led me to the Italian AEC). Prominent mention of mutual funds, which are a US thing, not UK thing. Much of it is word soup which is designed to sound impressive but is devoid of any actual meaning (would anyone like to hazard a guess at what "We invest with an income oriented value discipline where our inflation adjusted analysis identifies value in terms of prospective real returns" might mean?). Terms and conditions that appear to be cut and pasted from here.

I'm ashamed to say that at first glance I took it to be a real website...given that the website itself is obviously part of the scam it's a little ironic that it contains a warning about the very fraud that it's perpetrating.

AnotherJoe

How did you "find" this fraud? How was the contact to you made?

jamei305

Wolves51 wrote: »

They contacted me

Companies offering fixed-term bonds suitable for retail investors certainly do not contact you trying to sell them.

In fact if you find anyone trying to sell you an investment, you can be pretty sure it's not suitable for you.

Wolves51

To answer the question as to how I found this company, I was looking for a better return than a cash isa.
I found aecinvestmentsgroup.co.uk
The website seemed so plausible and so I filled in the contact details and in the space of 3 hours, I had 2 missed calls and an email with a spreadsheet of guaranteed returns. I don’t consider myself gullible, but was nearly convinced by them until reading the responses on this thread. Many thanks once again