Victims of a 'boiler room' scam will receive over £1 million in compensation after the financial watchdog intervened.
The Financial Services Authority (FSA) obtained a court order to force Aniz Kassamali Dhanji Manji to return £1 million to investors and Suresh Maganlal Bhowan to pay £17,233.
The pair ran Bayshore Nominees, a firm that took payment for worthless shares sold by Gatemore Securities and Enterprise Analytics Incorporated, unauthorised dealers cold-calling victims.
Jonathan Phelan, head of retail enforcement at the FSA, said: "We are pleased to have been able to secure the return of this money to consumers who invested with Bayshore.
"However, in most cases consumers will never see any of their money again. They should be careful to ensure that any firm they deal with is authorised, otherwise they stand to lose some or all of their investment."
People caught up in this scam – often vulnerable pensioners – rarely get their money back and cannot complain to the Financial Ombudsman as the operation is unregulated.
Yesterday, the FSA warned more consumers could be at risk of falling victim to scams, as fraud levels rise in the downturn.
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