TONY HETHERINGTON: Bond fraud part II

Tony Hetherington is Financial Mail on Sunday’s ace investigator, fighting readers corners, revealing the truth that lies behind closed doors and winning victories for those who have been left out-of-pocket. Find out how to contact him below.

J.S. writes: I have seen your report about a bogus offer of National Grid bonds and thought you might be interested in the similar offer I have received for bonds in Scottish & Southern Energy.

Tony Hetherington replies: Well, well! Two offers in two weeks, both from major companies and both promising a safe yield of more than 8 per cent, backed by the Financial Services Compensation Scheme if anything should go wrong. Not that anything should go wrong, since the sales pitch in both cases comes from a major bank, fully authorised by the Financial Conduct Authority. 

There is a problem though. Both offers are frauds by crooks who are impersonating the banks. Two weeks ago, I warned that Credit Suisse was supposedly inviting investment in National Grid Gas bonds paying 8.75 per cent. The crooks were using an email address very similar to the real one belonging to the Swiss bank. They used the bank’s logo and address. But they gave out their own phone number – 0207 043 4509 – which has never been used by the genuine bank.

Now we have an almost identical scenario, with an offer that is supposed to have come from the giant Citibank, asking you to put your savings into a bond from Scottish & Southern Energy, with the promise of fixed interest at 8.375 per cent. A Google search might show that these bonds exist – but they were marketed about 15 years ago.

The fraudsters are using Citibank’s address in London, but emails come from a bogus internet address: accounts@citiukbonds.com. This was set up just three weeks ago, with fees paid for only one year. And the fraudsters’ phone number is fake too: 0207 043 1921. And here’s a funny thing. This phone number is already well known to investor protection officials at the Financial Conduct Authority. Their own records show Citibank has been impersonated a number of times, with this as one of the numbers used in scams.

I told Citibank about the new scam and gave it all the details. I asked whether Citibank had pressed the FCA, the police or anyone else to take action to protect its own reputation and the public. It urged me to tell people to check the FCA website to ensure investments are genuine. But it claimed it would be ‘inappropriate’ to answer my question.

I put the same question to the watchdog itself. So what has the FCA done? Has anyone been arrested or charged? Has the FCA won a court injunction banning the fraudsters from posing as an authorised bank – an offence punishable by up to two years in prison?

The Financial Conduct Authority did not even reply. An authority that abdicates responsibility is worse than no authority at all. How long, I wonder, before victims of scams become vigilantes?

If you believe you are the victim of financial wrongdoing, write to Tony Hetherington at Financial Mail, 9 Derry Street, London W8 5HY or email tony.hetherington@mailonsunday.co.uk. Because of the high volume of enquiries, personal replies cannot be given. Please send only copies of original documents, which we regret cannot be returned.