The Ontario Securities Commission (OSC) has issued a warning about a possible advance fee scam involving illiquid stocks.
The OSC added Knox Securities Corp. LLC to its investor warning list on Friday. The regulator says that the firm is soliciting shareholders in illiquid stocks, including SK Resources, and offering to sell their shares for them at a substantial premium. However, it says that representatives of Knox have told investors that they would have to send an advance fee payment before their securities could be sold.
It reports that Knox’s website represents that it is a private boutique financial consultancy. However, the OSC says that Knox is not located at the address disclosed on its website, is not incorporated in Canada, and is not registered to sell securities on behalf of investors, provide advice, or engage in trading.
The commission also notes that its staff are aware that investors who purchased a number of illiquid securities, including SK Resources, are now being targeted by fraudulent ‘advance fee’ schemes.