M & A Rainmaker

Regular readers of the M&A Rainmaker Blog will be aware that we have highlighted the dangers of Boiler Room Scams before; for example in this blog here

http://mandarainmaker.co.uk/wordpress/2009/12/02/anderson-munro-invests-in-internet-veneer-of-respectability/#comment-13087

I.P.O.’s ( Initial Public Offerings ) are taking off in the U.S. this year and this is likely to increase the possibility of you getting a call from a Boiler Room or Chop Shop.

I was watching the film ” Boiler Room ” recently ( as part of my research ) and I noted a couple of things:

– The ” brokers ”  studied ” Wall Street ” to the point where they could recite lines from the actors without looking at the screen !!

You can bet that recent Boiler Room scammers have also studied ” Boiler Room “. Sean Liptrot and Dominic Ryan John probably paid particular attention.

– J.T. Marlin was based ” somewhere on the Long Island Expressway ” i.e. not on Wall Street but in New York, U.S.A. Whilst some Boiler Rooms may still operate from either the U.S. or the U.K. Alfort International Ltd and Newton Moore Limited are based in the British Virgin Islands.

Anderson Munro was ostensibly based in Hong Kong. If you are running a Boiler Room scam you don’t really want to be based in the U.K. or the U.S. because you are within the jurisdiction of those countries and – as in Boiler Room – the F.B.I. can monitor you and raid you. It’s much better to be based ( or to appear to be based ) in a foreign country because typically you are outside the jurisdiction of those countries and anyone who complains about you or tries to get their money back will be told that.

– the main victims were Harry Reynard ( a Gourmet foods company Purchasing Manager ) and a Docter – both unsophisticated investors. In reality the victims will range from unsophisticated to sophisticated  investors. The reaction of Harry’s wife is typical though !

– Technology, Telecommunications and the Internet has come on a long way since 1999/2000. We have spoken about how Anderson Munro achieved it’s Internet Profile. One of the ways that you try and check on brokers these days is via the Internet.

– The telephone sales techniques are clever – you have to admit it – they are clever !!

I am still studying Boiler Room so may have more comments later …..