'Clone firm' scams cost East Midlands investors £3million

The ongoing financial impact of Covid-19 is making people more susceptible to clone scams, according to the Financial Conduct Authority (FCA).

Action Fraud has reported a rise in 'clone firm' scams

More than £3 million was stolen from East Midlands investors last year as a result of 'clone firm' investment scams.

Fraudsters set up clone firms using the name, address and firm reference number (FRN) of real companies authorised by the regulator - the Financial Conduct Authority (FCA). They then send out sales materials linking to the websites of legitimate firms, to trick potential investors into thinking they are dealing with the real firm.

Losses can be high as fraudsters tend to encourage large or regular investments before disappearing with the money.