The telltale signs of a boiler-room scam

Boiler-room scams devastate lives and can leave you seriously out of pocket. Merryn Somerset Webb explains how to ensure you're not caught out.

Three weeks ago, three British men were sentenced to a total of 43 years in prison in America. Their crime was a classic boiler-room scam, which they used to con British investors out of £80m.They then funnelled the money through US bank accounts and spent it on having a good time think boats, planes, luxury houses and endless cars. £80m is proper money, but the really horrible thing is that they didn't find it that hard to get hold of.

The boiler-room scam involves employing rooms full of people (paid commission only) to cold call would-be investors and use high-pressure sales tactics to get them to buy either non-existent or worthless shares over the phone. The shares never materialise and the money never comes back.

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Merryn Somerset Webb

Merryn Somerset Webb started her career in Tokyo at public broadcaster NHK before becoming a Japanese equity broker at what was then Warburgs. She went on to work at SBC and UBS without moving from her desk in Kamiyacho (it was the age of mergers).

After five years in Japan she returned to work in the UK at Paribas. This soon became BNP Paribas. Again, no desk move was required. On leaving the City, Merryn helped The Week magazine with its City pages before becoming the launch editor of MoneyWeek in 2000 and taking on columns first in the Sunday Times and then in 2009 in the Financial Times

Twenty years on, MoneyWeek is the best-selling financial magazine in the UK. Merryn was its Editor in Chief until 2022. She is now a senior columnist at Bloomberg and host of the Merryn Talks Money podcast -  but still writes for Moneyweek monthly. 

Merryn is also is a non executive director of two investment trusts – BlackRock Throgmorton, and the Murray Income Investment Trust.