Boiler rooms operations are share scams. The operator will sell worthless shares at inflated prices to investors that are impossible to sell. Every year rip-off boiler-rooms continue to sting UK investors for millions of pounds despite attempts to crack down. UK investors are cold-called by fake-stockbrokers looking to lure cash out of them. The ruse is remarkably simple. A broker, usually operating from an overseas firm, will cold call an investor and propose they buy shares in a particular company

The share has usually been ramped on online message boards, they could be a small, unquoted company that the broker claims is planning to list and, in extreme cases, the company will not exist at all and the broker is simply selling shares in thin air before taking the money and running. The firms will operate from boiler room 'hotspots', such as Spain, Switzerland, Dubai, Japan, Bermuda or the USA, so they are outside of the remit of the Financial Services Authority. They will have a UK-listed address and a grand sounding name to give an air of legitimacy

They are called 'boiler room' scams because of the highly pressurised sales technique employed by the broker. They can be forceful, persistent and highly aggressive. A common tactic is to create a sense of urgency about a stock, such as telling the investor it will explode any day so they need to invest quickly. It's not only novice investors that get sucked in. The FSA says that it is often experienced and sophisticated investors that fall victim to the scam. Those who fall victim lose an average of £20,000. In the majority of cases, the shares being sold are worthless and the boiler room vanishes, leaving the investor out of pocket