Promising Returns of 80%, PRIME FMS Disappears Along with Funds

The Ponzi scheme was placed on CRFIN's blacklist in June 2015, and the FCA warned of the fake "London broker"

Only a month ago, the Self-Regulatory Organization “Centre for Regulation in OTC Financial Instruments and Technologies” (CRFIN) added the website of Prime FMS to its blacklist, noting signs of being a financial pyramid scam. Now the website has been shut down without notice, leaving customers with no apparent way to get their money back.

Even before the CRFIN warning and the eventual disappearance of the firm, there were strong warning signs against trusting Prime FMS available for traders. The website promoted unreasonable guaranteed returns, which always spells trouble. On many Russian online forums and even on its own facebook profile page there are many complaints that Prime FMS simply ignores any contact attempt by its clients once it has their money.

Moreover, back in November 2014, the British financial regulator, the FCA, issued a warning to the public that the Prime Financial Management Services Limited (Prime FMS), which claimed to be based in London, offers its financial services to UK citizens without authorization and license.

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CRFIN listed these characteristics of Prime FMS back in June:

  • Promise of improbable and/or guaranteed profit – Potential clients are offered trust management. According to a trust management contract the company promises to provide minimal profitability of 80% from the invested sum within 90 calendar days.
  • Availability of considerable bonuses for attracting clients- The company offers multi-level referral programs.
  • No objective payment guarantees – The business model doesn’t have a sufficient level of transparency. There are also no objective guarantees of payment return and paying the claimed percentage, otherwise than by using the previous clients’ deposits.
  • Signs of a false positioning – There is no available information about licenses that give the right to attract clients’ funds. There is no contract on trust management available on the site. The company is oriented towards the Russian-speaking audience, Russian citizens in particular, and the trust management contract contains provisions on complying with the legislation of the Russian Federation, while according to the current legislation of the Russian Federation, trust management of money funds requires a special license of the Bank of Russia.

Unfortunately, in spite of previous warnings, Prime FMS still managed to escape without explanation. Thus, in the absence of a specific authorization or company registration body to turn to, it appears that customers have completely lost their money.

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