Securities regulators in New Brunswick issued an investor alert Friday regarding a potential investment scheme originating in California.
New Brunswick’s Financial and Consumer Services Commission (FCSC) issued an alert to warn investors about a firm known as World Capital Market (aka WCM777), which has been issued a cease trade orders by regulators in California and Massachusetts amid allegations that it’s operating an unregistered investment scheme.
According to a cease and desist order from California’s Business, Consumer Services and Housing Agency, the firm is offering membership units in an online cloud service and promising high returns on those units. It alleges that these membership units constitute securities, and that these securities are not properly registered for sale in the state. It also alleges that the firm and various individuals made material misrepresentations in selling the securities.
The California Commissioner of Business Oversight issued a cease and desist order in response to the allegations, indicating that the order is “necessary, in the public interest, for the protection of investors”.
While there are no reported victims in the province, the FCSC has added the companies involved to its online caution list.
“The California investigation highlights several very important red flags that investors should consider before making any investment,” said Jake van der Laan, director of enforcement at FCNSC. “The company appears to have no other business than selling these marketing units and investors have been promised returns of 140% in under a year.”
The commission advises investors who have been contacted by these sorts of schemes to contact regulators.