Avoid this scam firm from A to Z

Tony is offered a share of the Glencore spoils...

Anyone who even takes a passing glance at the city pages will find it hard to avoid Glencore, the Swiss-based but South African-led commodities dealer which is due to move out of private obscurity into the full glare of a place high up the FTSE 100 share index.

Its flotation – or initial public offering – has divided analysts. Some say the $60bn company is selling a slice of its shares on the market because the commodity cycle has peaked so it's the last chance. Others claim it will grow as any setback in raw material prices is short term.

Either way, this is not a stock for small investors. The share buyer with £1,000 or even £10,000 is not on the Glencore radar. To qualify for the action, you'll need millions.

So when someone called Stefan Vassic from “London-based” stockbroker firm AZ Markets called to discuss Glencore, I was surprised.

Obviously reading from a script, Vassic told me AZ was about to release a buy recommendation for Glencore. “We advise on commodities and mining and emerging markets. Our in-house team recently turned £5,000 into £16,000 in three months. Is that the sort of growth that you would like to experience?”

After trying to pump me for personal information (how were my investments doing? And how much money did I have to invest?) he told me that AZ was “the official stockbroker to Glencore”. Try telling that to the real talent pool Glencore has brought together. It's simply a lie.

Now Vassic must be very junior. He kept saying “afternoon” when it was 10.30am (so what time zone was he in?). He said he worked in Canary Wharf so I asked whether he had a good view. “Well, there's buildings (true) and lots of docks (true 40 years ago).”

He told me his “senior analyst” would call. The next day, Scott Fenton phoned from AZ. “We provide a fully comprehensive stockbroking service. In January 2011, an external audit showed gains of 64% across all our recommendations.” He ignored my request for details of the audit while, oddly, there is nothing on the AZ website about what sounds a roaring success. That may be because the AZ website was set up in Panama on April 13, 2011. Fenton claimed the firm had been around for six years.

Fenton stressed the charges were just 1.5% of any gain – but there would be big gains. At one stage, he said the shares would go from £5.30 to £14 in a matter of days while, more modestly, he later said they would move a £8.60 to £10 range. There may be some gain when Glencore floats but nothing like that.

AZ Markets is one of several “brokers” cold calling with Glencore “offers”. Gevab Europe, which gives a false address in Fleet St, London, has a website dating back as far as 19 February 2011 and has been “selling” Glencore at £5 a share. Gevab claims a prize in the Daily Telegraph Wealth Management Awards “last month”. That is a lie – the real awards were in November and only real firms could win. Sino Trade Europe is also punting Glencore to its calling list – it was the subject of an FSA warning in March.

AZ, Gevab and Sino Trade Europe all claim FSA registration numbers via “passporting”. Strangely, all relate to “re-insurance mediation” companies in central Europe. Those of Gevab and Sino are in Austria – no address given for either- while AZ uses the number of AZ Makierska in Brno, Czech Republic. Neither Austria nor the Czech Republic is noted for re-insurance activity so these firms may well have been set up by the boiler room bosses as a front to “legitimise” themselves.

This is a simple scam. The share pushers take my money. I don't get any shares. And Vassic, Fenton and all the others go back into the shadows, change their identity and start over again.

Meanwhile, follow me on twitter at @tonylevene1

Award-winning scams expert Tony Levene explains why he's writing a blog about scams and why he is The Scam Magnet!