A trading platform has been shut down by the Insolvency Service after members of the public complained they were pressurised into investing and had lost $1.25m.
Global Fin Services (GFS) was wound up “in the public interest” by the UK High Court on 16 July.
Set up in October 2015, GFS offered trading in forex, derivatives and other investments via an online platform called trade12.com.
Registered in London, GFS’s customers were predominately located in south-east Asia, Russia, Belarus and Ukraine.
The Insolvency Service launched an investigation after it received complaints from the public.
Guarantee to cap losses
It found that GFS’s representatives made unsolicited calls to people who often had little or no experience of online trading.
Customers were reportedly subjected to highly pressurised sales tactics and were misled about the gains they could expect.
Some investors were quoted returns of between 10-15% per week or per month, with a guarantee to cap losses at 10% of the investment.
Others were promised returns of between 50-100% on deposits within 30 days.
Investors also complained that GFS made it difficult to withdraw their funds and that their accounts would suffer losses when money was taken out.
In a ploy to recover any outflows, GFS account managers would then urge customers to invest more to recoup the losses.
Failed to provide records
Investigators could not find any evidence that the funds paid through the website were invested as sold.
GFS failed to provide any of its accounting records, while also claiming it provided clearing services for its holding company Exo Capital Markets, a company registered in the Marshall Islands that also traded as Trade 12.
The Insolvency Service did not provide details of how many customers made complaints, but they collectively reported losses of over $1.25m.
However, given the lack of company records, the total amount of investments cannot be confirmed.
There was also evidence that financial regulators across the world, including the UK’s Financial Conduct Authority, had issued warnings against GFS and Exo Capital Markets.
Blatant disregard for clients
Irshard Mohammed, chief investigator for the Insolvency Service, said: “GFS had a blatant disregard for their customers. They preyed on people who had little to no experience in making investments of this nature, using unscrupulous tactics to secure funds.
“We are pleased that the courts have shut down this company, saving any more people losing their money and we hope this sends a strong message that we will robustly investigate and take action where people’s funds and savings are at risk.”
