The Securities & Futures Commission warns of a boiler room operator named Bernard Simpson Consultants which lures investors to buy US company stocks by making cold calls.

The commission first received a complaint against the company in 2003. At that time, it claimed it had offices in Malaysia and Costa Rica. However, recent reports showed the company might have changed identities. It now purports to operate from Costa Rica and South Korea and has changed its website address from www.bernardsimpson.net to www.bscmail.net.

The company uses the tactic of "forced invoicing", where it issues invoices to investors and asks them to pay for stocks that it claims have been bought on their behalf, even though the investors have never agreed to the purchase.

10 complaints

The commission has so far received 10 complaints against the company, the majority from Hong Kong investors.

In two of the worst cases, the victims lost around $540,000 in total. Both were called by the company to buy overseas stocks and they paid to the company's bank account in Hungary or its office in Malaysia.

The commission said reputable brokers do not cold call people who are not their clients to offer investment opportunities.

Safe investment

To avoid falling victim to boiler room scams, investors should:

* verify the legitimacy of the people or companies they deal with from a reliable source of information;

* beware of too-good-to-be-true investment offers;

* not invest based solely on a telephone sales pitch or an unsolicited email, and don't make a decision hastily; and,

* refuse to pay for a purchase to which you have not agreed.