Business Bureau warns of offshore investment scams

North American investors swept up in the new overseas investment craze would do well to temper their euphoria with the utmost caution, since a new breed of con artists is cashing in on the rush to global investing. Swindlers with bogus overseas investment schemes and high- pressure telephone “boiler room” sales operations located outside North America will fleece small investors for tens of billions of dollars during the 1990s, says the Better Business Bureau of Toronto.

The Bureau says it is receiving a new surge in complaints about overseas investment swindles involving precious metals, mining, currency speculation and “special” foreign banking instruments.

One shadowy Canadian stock promoter, who sometimes referred to himself as “Count Saladosh of Hungary,” disappeared, perhaps to Cuba, in September, 1988, when U.S. officials closed in on his boiler room operation in Costa Rica. The high-pressure sales operation is believed to have taken $40 million, mostly from U.S. investors, for investments in sulphur mines and Jojoba beans.

A swiss man, who led an intricate double life for a time in Montreal, was arrested this spring in South America after spending months on the lam in an effort to elude extradition related to investment fraud. He is accused of having bilked 1,300 swiss investors out of more than $167 million in a phony Colorado oil field scheme.

Paul Tuz, president of the Better Business Bureau in Toronto, warns that “the rise of off-shore boiler room operations will make it much more difficult, if not impossible, for investors to recover their funds.”