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If something seems too good to be true, it usually is. According to New Zealand's financial markets regulator, the FMA, this tried-and-true market dictum could apply to Equity Budget, which promises “unrealistic returns” of up to 7% per day. Additionally, it lacks proper regulation and is not included on the national register of financial service providers required to offer financial products.
FMA Alerts on Potential Get-Rich-Quick Scam
According to the official Equity Budget website, the company has been offering its services for 11 years and operates from New Zealand. However, the FMA warns retail investors, noting that “it is also not registered with the New Zealand Companies Office.”
Additionally, according to the New Zealand regulator's warning, Equity Budget “does not appear to be a company registered in any other jurisdiction or subject to regulation” by financial supervisory commissions in other countries.
Equity Budget would invest in agricultural, freight, logistics and real estate projects, providing its clients with a guaranteed daily rate of return based on the level of “investment plan” they choose.
By investing as little as $100, a trader can expect a daily rate of return of 4.1%, while an investment of $100,000 would produce a daily return of 7%. If this scheme were true, investors could accumulate $840,000 in their accounts after 120 days (the maximum investment period). Sounds too good to be true, right?
Equity Budget offers “managed investment plans with unrealistic returns but is not registered on the register of financial service providers, which is required to offer financial products in New Zealand”, warns the FMA.
The operation of the potentially fraudulent business bears the hallmarks of a get-rich-quick scheme, referring to strategies that promise large sums of money with little or no investment, effort or risk, often on a short period.
Other warnings from the FMA
The FMA actively fights financial fraud and protects investors against various scams. Recently, the regulator took decisive action by canceling the crowdfunding service license of Equitise Pty Ltd, a licensed equity crowdfunding service provider since 2014, due to significant breaches of licensee obligations. market services license and non-compliance with legal requirements. Additionally, the FMA has warned investors about AxonExchange, an alleged cryptocurrency exchange scam.
The rise of imposter scams, particularly product misrepresentation fraud, has become a growing concern for the FMA. In 2023 alone, the regulator issued 82 warnings regarding suspected investment scams and fraudulent websites, as well as 22 warnings regarding unregistered companies.
Additionally, the FMA has identified an emerging trend where fraudsters are impersonating other regulators, such as the UK's Financial Conduct Authority, to target New Zealand residents.
This article was written by Damian Chmiel on www.financemagnates.com.
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