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Shareholder security

Enwell Energy shareholders should be wary of unsolicited advice, offers to buy shares at a higher price than their market value or offers of free reports about the company.

Shareholders of publicly traded companies have been known to receive unsolicited phone calls or correspondence about investments, including offers to buy shares at higher prices than their market value. These are usually from “brokers” based overseas and generally involve a request for a payment upfront which the scammers say will be paid back if the sale does not go ahead. This is called an “advance fee scam” – you pay the money and then hear nothing more.

Another scam is where shareholders are offered worthless, overpriced or non-existent shares. Sometimes scammers claim to be working for the company issuing the shares. In other cases scammers will use the name “firm registration number” (FRN) and address of firms and individuals who are Financial Conduct Authority (FCA) authorised. This is called a “clone firm”.

All of these techniques are called “boiler room scams”. The so-called brokers can be very persuasive and very persistent, and often sound plausible, and the dangers are significant. The UK’s FCA has found that victims of boiler room scams lose an average of £20,000 each, with as much as £200 million being lost in the UK each year.

Be extremely wary of anyone who calls you unsolicited to offer financial advice. Reputable advisors or brokers are unlikely to operate in this way.

What to do if you’re given unsolicited investment advice

  • Ask for the name of the person and organisation.
  • Check that they are properly authorised by the FCA before getting involved. You can check on the FCA website.
  • Report the scam to the FCA using its online share fraud and boiler room reporting form.
  • If you keep being called, hang up.

How to protect against fraud

We strongly advise our shareholders only to deal with financial services firms that are authorised by the FCA. If you deal with unauthorised firms you won’t be eligible for the Financial Services Compensation Scheme.

You can check whether you are dealing with a clone firm by asking for their firm reference number (FRN) and contact details and then calling them back on the switchboard number on the FCA Register. Never use a link in an email or website from the firm offering you an investment.

You can find further advice from the FCA here.

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