Re: 3/29/01 - Newsbytes: Securities Regulator Tries Scam Game To Prove A Point
Securities Regulator Tries Scam Game To Prove A Point
By Steven Bonisteel, Newsbytes
TORONTO, ONTARIO, CANADA,
29 Mar 2001, 4:25 PM CST
The securities regulator in Ontario, Canada, isn't saying there's a sucker born every single minute. But it does say that more than 1,000 of them may have shown up at a fake investment Web site it operated during the six weeks it pretended to be an investment scam artist.
The Ontario Securities Commission (OSC) said today that it launched its phony investment site - part of en effort it called "Project Cyber Scam" - Jan. 22, to demonstrate the dangers in store for investors who believe everything they see on the Internet.
The Web site (formerly at noriskwealth.ca ) was designed to look similar to the online scams the OSC says it has seen real fraudsters create.
Pretending to be an investment business called Secured Financial Advancement Services, a contractor hired by the OSC created the "no-risk" Web site, with its promise of returns as high as 30 percent a month and a liberal dose of stock photography showing expensive cars and palm-treed holiday locations.
Michael Watson, director of the OSC's enforcement branch, said the Web site, which was promoted through online chat-room and message-board posts and through a number of small newspaper ads, received numerous requests for information from its visitors and a number responses pledging money.
"It's one thing to try to say that people are too gullible in relation to accepting promotions over the Internet, but it's another thing to do a clear demonstration of it," Watson told Newsbytes.
"The lesson from this exercise is that people should not trust information on the Internet unless they have confidence in the source," he said.
Watson said the fake site - including its domain name registration - was set up to hide the involvement of the OSC, which did not actually communicate with or collect personal information from any of the site's visitors.
"People who made an effort to try and send us money received a reply saying that the system was, for technical reasons, incapable of receiving anything," Watson said. "Part of the notice said they shouldn't accept as truthful anything they read on that Web site."
However, the site's operators, Toronto-based AssetRisk Advisory Inc., were able to determine from Web logs the home country of most visitors.
Watson said some 60 percent of the site's visitors were from the US, 30 percent were from Canada, and 10 percent from other countries.
Among the US visitors were the OSC enforcement team's counterparts in Washington State. The site was also spotted by securities regulators from the Canadian provinces of British Columbia and Manitoba, as well as by the OSC's own staff, which were not told of the project.
Watson said the site clearly targeted Canadian investors, claiming that its offer of "international debentures" traded by big players in "a secret European location" were eligible for Canada's tax-free retirement savings plans.
He said OSC staffers who spotted the site alerted the enforcement branch's head of Internet investigations, who was aware of the Web ploy.
In doing dual-duty as a test of the regulators themselves, the fake site "demonstrated that proactive monitoring of the Internet can assist regulators in detecting scam artists and shutting them down," Watson said.
The OSC is at: osc.gov.on.ca .
A version of the scam Web site now on the OSC's own server is here: noriskwealth.ca .
Reported by Newsbytes.com, newsbytes.com .
16:25 CST
(20010329/Press contact: Rowena McDougall, 416-593-8117 /WIRES TOP, ONLINE, BUSINESS, LEGAL/WWWSCAM/PHOTO)
© 2001 The Washington Post Company
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The site may now be viewed at: osc.gov.ca. |
