SIF Oltenia used as bait in American investment scam

Profits of up to 20% per day in dollars. This is the promise made by oltfis.com, the website for an investment fund from Romania that is licensed by the National Securities Commission (CNVM). Add to this that the name of the fund is Oltenia Financial Investment Society (the word for word translation of SIF Oltenia) and success in attracting investors is practically guaranteed.

However, there is no SIF Oltenia, nor any investment fund authorised by CNVM behind the website. This is a scam intended to fool potential investors, though not necessarily Romanian investors who have been through the experience of Caritas (a pyramid investment scheme in the early 1990s) and FNI (a more recent investment scam): this scam is mainly aimed at American investors.

CNVM, the authority that regulates the operations of investment funds in Romania, was notified of the scam by a gullible American investor in March who had lost some 8,000 dollars in his dealings with the “investment fund”. The Commission says there is not much it can do to avoid investors being tricked by an investment fund claiming to come from Romania.

“Our own checks shows that SIF Oltenia has nothing to do with the website in question. This situation has been known and analysed since March, but any solution to this case does not come under CNVM competency, so the CNVM has notified the relevant state institutions,” said Ciprian Ene, the CNVM spokesperson. The site is part of a broader group of webpages that promise investors fast returns, such as gaining a whole year”s interest on the dollar in just a few hours.

When contacted by Ziarul Financiar yesterday, SIF Oltenia representatives were completely unaware that the website existed. They had made no comment by the time this story went to press.

Not only are administrators of funds not allowed to promise specific yields to their investors (a 20% daily yield is impossible to obtain), but this bogus investment fund also guarantees investors the amounts invested, as in the case of FNI.

According to data from the Internet, the oltfis.com address was bought in September of last year by Darren Bull, who was resident in Bucharest. The website is hosted by a Lithuanian Internet service company.

The bogus investment fund uses an address in Deva on a non-existent street, while the contact details display a map of Bucharest and two mobile phone numbers that have their voice-mail services switched on.

The website describes in great detail the investments made by SIF Oltenia in the last two years, and mentions companies such as Sanex Cluj, Argus Constanta and Postelecom, the fixed telephone operator of the Posta Romana (Romanian postal service company) that is yet to be launched. It also lists the Romanian laws and regulations governing its operations and even the unique registration number belonging to SIF Oltenia.

The site says that the “investment fund” originated out of the former Fondul de Investitii Galati (Galati Investment Fund). However, this Romanian mutual fund ceased to exist last year when it merged with another mutual fund. Galati used to be managed by Quadrant Asset Management. Quadrant officials say they had known about the website for quite some time, but that there was nothing they could do about it. vlad.nicolaescu@zf.ro