(March 29 – 12:10 ET) – A phoney Web site established by the Ontario Securities Commission illustrates the pitfalls of making investment decisions based on unverifiable information provided over the Internet.

The OSC site, NoRiskWealth.ca was launched on January 22, and promised investors unusually high returns with little or no risk. In the six weeks that the site was operational it had more than 16,000 hits with over 1,000 visitor sessions.

OSC staff modelled the content on scams that they have observed, and promoted it using the same tactics that are generally employed by Internet con artists.

“People were prepared to invest thousands of dollars based solely on unsubstantiated information provided on a Web site, and scores more wanted additional information,” said OSC Director of Enforcement, Michael Watson. “The lesson from this exercise is that people should not trust information on the Internet unless they have confidence in the source.”

The project also tested the ability of securities regulators to monitor the Internet “Four different regulators, including OSC staff who were not aware of the project, discovered the site just days after it went live,” Watson said. “This experiment demonstrated that proactive monitoring of the Internet can assist regulators in detecting scam artists and shutting them down.”

The OSC gathered information about potential traffic to other Web sites, Watson added. For example, approximately 60% of the visitors to the Web site came from the United States, 30% from Canada and 10% from other countries.