Japan’s FSA receives 197 complaints about fraudulent investment solicitation in Q1’2017
About 21% of those who complained about fraudulent investment solicitation are people in their 70s, according to data from the Japan’s FSA Counseling Office for Financial Services Users.
Japan is known for its strict business laws when it comes to the financial services industry, including the Forex sector. And yet, the nation is not immune to the damage caused by financial scams, as shown by the latest data provided by the Counseling Office for Financial Services Users at Japan’s Financial Services Agency.
During the quarter from January 1, 2017 to March 31, 2017, the counseling service received 197 reports of cases of fraudulent investment solicitation, with the bulk of the complaints coming from elderly people. Around 21% of the complaints came from people in their 70s, whereas 20% came from people in their 60s. People in their 80s accounted for 10% of these complaints.
The FSA says that in 120 of the cases investors reported damage as a result of the solicitation.
Elderly people are typical financial scam targets due to their vulnerability and the significant size of their wallets. Moreover, sales teams of online trading companies often use manipulative tactics that have a swift and detrimental effect on potential customers. A recent study by scientists at the Laboratory of Social Psychology at the University of Aix-Marseille has provided an elaborate picture of how these mentally abusive tactics work and what human traits they exploit. In its turn, the French financial markets regulator AMF has explained how these tactics break the law.
Going back to the work of the FSA’s Counseling Office during the first quarter of the year, let’s mention some general numbers. During the January-March 2017 period, the office handled 8,115 enquiries and comments, a decrease from the 9,268 cases handled in the October-December 2016 period.
Enquiries and comments about investment products amounted to 2,269 in the first quarter of 2017, down by 560 cases from the preceding quarter. In terms of percentage, such cases accounted for 28% of the total.
Across investment products, there were 426 cases (19%) concerning listed shares, 246 cases (11%) concerning FX, and 230 cases (10% of the total) concerning investment trusts.
Customers who made comments or enquired about investment products most often asked about securities companies (Type 1 business), the FSA said.