As any investor or electric car fan who jumped on Tesla’s Initial Public Offering back in June 2010 and has held onto their stock since will tell you, Tesla Motors [NASDAQ:TSLA] stock has proven a worthy investment. So much so, anyone who purchased $6,000 of shares in the automaker back on June 29, 2010 could sell that same stock today and earn enough money to buy themselves a luxury Tesla Model S.
Even companies connected to Tesla benefit from its positive stock vibe. Earlier this year, investor excitement surrounding Tesla Motors’ acquisition of privately-held Michigan-based tool and die manufacturer Riviera Tool LLC caused enough confusion in the markets that traders, desperate to benefit from Tesla’s midas touch, erroneously purchased thousands of shares in a now defunct shell of a company with a similar name listed on the pink sheets. The problem became so large, that the Financial Industry Regulatory Authority (FINRA) was forced to step in and halt all deals of the penny stock.
That particular problem was caused by a lack of due diligence from traders, but now it seems there’s a much more sinister problem concerning investors and Tesla stock: a fake Internet stock trading scam from Australia which has seen investors part with more than $2.4 million Australian ($1.78 million U.S.) in exchange for Tesla stock.
But as Autobloggreen reports, investors who handed over their hard-earned cash for a chance to invest in the electric car revolution found not a share was transferred into their name.
Indeed, not a single share appears to have been purchased on their behalf, either from Tesla Motors or any other electric automaker.
It goes without saying that the Californian automaker, while it has declined to comment on the matter, appears to have nothing to do with the scam and is not under investigation.
But the alleged perpetrator — Larosa Holdings — is the prime suspect.
Purporting to have locations in both Dubai and Canada, Larosa Holdings is under investigating from both the Consumer Protection Agency and the police in the state of Western Australia, for the nefarious practice of taking investor money under false pretences. While its investigations are not yet concluded, investigators have already confirmed that the company’s claim to be registered in Dubai is false: having checked with the Dubai Financial Services Authority, no trace of the firm can be found.
In addition, the site — now seized under the investigation — appears to have stolen stock and press images from other sites on the Internet.
“We need to urgently warn would-be investors to be aware that this website and the company behind it, Larosa Group, appear to be an elaborate fabrication to deceive and defraud investors whose money is likely to be lost,” said the Commissioner for Consumer Protection Anne Driscoll. “Anyone who has had dealing with Larosa Group is urged to make a report to the Australian Cybercrime Online reporting Network (ACORN). I would strongly recommend that investors use only use licensed financial investment operators when looking to invest their money.”
In recent years, the growth of the Internet has made it easier than ever before for net-savvy consumers to make investments from the comfort of their own home without engaging in the professional services of a traditional stock broker. Given some of the fees and restrictions made by large investment companies, there’s even more temptation to make your own investments online with a few clicks.
But while consumers may find themselves saving some money going with online trading services, we’d like to echo the words of Ms. Driscoll: when making an investment of any sort, only use official, licensed brokers — and make sure that all due diligence has been done before transferring any funds.
Transport Evolved is not a financial services website, nor should any of the text above be considered financial advice. Always seek the professional services of a trained, registered trader before making any investments.
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