Clone and scam firm warnings are issued by the FCA when it believes a rogue operator is using fake or copied details from a legitimate investment or financial advice business.
Scammers often use a fake ‘cloned’ website to lure victims.
In the past two years more than 700 firms have been hit by clone scams including Financial Planning firm Boosst and providers such as Vanguard, 7IM and Royal London.
The FOI request shows that in 2014 there were 173 clone firm warnings. By 2015 this had fallen to 92 but has risen steadily since then reaching 303 in 2018 and 365 in 2019 - equivalent to seven a week.
Number of Clone / Scam Warnings
Source: FCA FOI request Jan 2020
The FCA has created a ‘specialist clones team’ to deal with the rising problem.
In its response to the FOI request, the FCA said: “The purpose of the team is to develop a focussed understanding about how clones operate with a view to developing strategies to disrupt and stop such conduct, and enable authorised firms and consumers to better protect themselves against such scams.”
The FCA said the team was part of its wider anti-scam and financial abuse operations and it was not able to give annual figures for the cost of running the clones team.
The FCA said: “Whilst there is a specialist team now primarily dealing with the issue of clones and scams there are a number of other areas across the FCA that also deal with work related to this subject and which is incorporated into their business as usual activities. It therefore follows we do not have a definitive record of the associated costs.”