Delays in issuing warnings about fraudulent investment websites are putting savers at risk

Is City watchdog the Financial Conduct Authority overworked?

I ask because of the worrying lag between alerting it to a scam and any subsequent action being taken.

It was back on December 16 that I emailed it about some crooks using the name Black Diamond Finance, and my article about this lot appeared in the Mirror the next day.

Only this week has the watchdog added its name to the consumer alert list of unauthorised firms targeting savers.

In the intervening time it was merrily trying to snare victims, and one person was saved only thanks to seeing my article.

“I read Andrew Penman’s article published on December 17 with particular interest, headlined ‘Is any watchdog capable of stopping the torrent of frauds on Google?’, because it described exactly what happened to me,” said the chap from Newcastle.

“I was about to advise my 28-year-old daughter to invest her hard and long saved £10,000 for a potential house deposit in Tesco’s Corporate Bond yielding 5.2%, as advised in an email from [email protected]

“Then I thought twice about the absence of a sender’s name and address on his email and was suspicious of the phone number given to me by someone calling himself Patrick Jones.

“So I web searched for ‘Black Diamond Finance scam’ and the article came up.

“Jones has phoned several times to encourage the purchase along and even urged me to warn my daughter to invest quickly ‘before the bonds all go’.

“So I write this to thank Andrew Penman and his team for warning us of the danger of dealing with this company.

“I found the FCA’s website particularly unhelpful in reporting this so that others might be protected.”

I’m delighted that my article helped this reader, but shouldn’t the Financial Conduct Authority be acting faster to help protect the public?

I came across Black Diamond after searching online for “best interest rates” and a Google advert led to a supposed bond comparison website searchukbonds.com.

I filled in my details and was contacted by someone from blackdiamondfinance.com who tried to persuade me to buy the Tesco bond, using high pressure tactics including saying I had to be quick or I’d miss the chance.

He claimed the firm was authorised by the FCA, but this lot is a clone of what used to be a genuine FCA regulated firm with a similar name, Black Diamond SRL.

The FCA says that you can avoid falling for clones of authorised firms but going onto its website, finding the details of the real firm and using these to contact it. But there’s a huge flaw in this advice: the more clever rogues tend to clone firms that are difficult to contact, such as ones authorised by the FCA but based abroad.

Black Diamond SRL is a good example. It is based in Milan, the phone number on the FCA register is not answered and I’ve had no reply to my emails to it. So it was impossible to check whether the website www.blackdiamondfinance.com was set up by the authorised firm or by crooks.

Why is the FCA taking so long to warn the public of shams like this?

“Last year we published 1,184 warnings about potentially fraudulent firms,” said an FCA spokesperson.

“We analyse and assess all reports of unauthorised business received from consumers, firms, and other sources.

“Before we publish a warning about a cloned firm we need to carry out a number of checks.

“Warnings are generally posted as soon as possible and we issued this one as soon we received confirmation from the authorised firm that it had been cloned.

“We continue to encourage customers to deal with FCA-authorised firms.

“If they are unsure they should check on our register and contact the firm on the details provided to verify that they are dealing with the regulated firm.”