Do not invest! Bond purporting to offer 18% annual yield with no risk. Can regulator block advertising of this?

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MugsGame

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I got a Google Ad on my phone's suggested articles timeline for an "investment bond" offering the following (direct quotes):
  1. 18% annual yield
  2. 4.5% fixed quarterly coupon rate
  3. 36 months bond maturity period
  4. 100% bond buyback value
The further wording around 4. does its very best to make it sound like a risk-free capital guarantee.

I will not be touching this with a barge pole as I know no such investment product is possible.

However, I am concerned about less sophisticated investors being sucked in. The ad and product website does its best to make the company and product seem respectable - the instrument is seemingly quoted on and invested in via a European exchange, and three Irish entities are listed as issuer, trustee and overseas counsel. The other three entities are based in jurisdictions that some might consider lax on financial transparency and which could be used to shield funds from tracing and retrieval.

There are glowing reviews on Google but a mixture on TrustPilot. Many of the glowing reviews are of a similar form or are not from investors who have held bonds to "maturity".

I expect the bond will perform mostly as advertised until near maturity, when a rollover of capital and a fresh investment will be encouraged.

I reported the ad to Google but they've rejected my complaint unless I can provide more specific details of how it violates Google's policies. I may do that when I have time.

My question is - is there anything that can be done under Irish regulations to prevent this being advertised in Ireland or targeted at Irish investors?

There is a negative discussion about a prior issue of similarly named bonds on Reddit, with some suggestions that it may be a Ponzi scheme (you might very well think that; I couldn't possibly comment.).

I'm not going to name or link to the product for now, as I don't want to advertise it further, but you can probably identify it from the above details.
 
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I have a suspicion that the principals have run similar structures before under other names, targeting investors in specific countries using entities in those countries to lend an air of respectability.
 
Hi Mugs

A company is not allowed to advertise for deposits in Ireland unless they are authorised by the Central Bank.

The Central Bank frequently puts out warning notices. Check to see if they have already issued a warning notice.

Key Post - I have a Bank of Ireland tracker – should I consider fixing?

Remember that you can have: A 5-year fix at 3.5% – a monthly repayment of €803, or A 10-year fix at 3.8% – a monthly repayment of €824 @Brendan Burgess said his inclination was to fix for 10 years. That has the advantage of only having to worry about rate fluctuations for the remaining 9.5...
www.askaboutmoney.com

Such a warning notice might be sufficient for Google to take down the ad.

If they have not issued such a notice, you should report it to the Central Bank.

Brendan
 
MugsGame said:
My question is - is there anything that can be done under Irish regulations to prevent this being advertised in Ireland or targeted at Irish investors?
Click to expand...

Do they claim to be Irish? Have they an Irish address?

If so, the Central Bank will take action.

If not, I am not sure if they can issue a warning notice.

Brendan
 
They don't claim to be Irish, but list three Irish entities as peripherally involved, one of which appears to be an established Irish law firm specializing in financial services. I think this is a deliberate attempt to lend bona fides to the operation.

The actual geographical base of operations appears to be the same as the "ladies of negotiable affection" who were recently "advertised" on AAM.
 
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The UK FCA posted a warning about what appears to be the same firm in 2016 (last updated 2021 according to web.archive.org), but it's since been taken down.

I can't see anything on our Central Bank site.
 
Hmm, I don't know if this changes the regulatory picture:
The BONDS are issued by a Special Purpose Vehicle (SPV) incorporated in Ireland whose sole purpose is to issue the said Notes under its approved Program.
Click to expand...
Whereas my naïve impression was that its sole purpose is to funnel money to its ultimate destination, via another sunny jurisdiction where this fund appears to be "regulated".
 
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It sounds like an outright fraud.

Check with the Irish firms they mention and I bet that they have never heard of them.

Then report to the Central Bank.

Brendan
 
Hi Mugs,

Is this based in Dubai as it seems it is very similar to what I have encountered on social media and just had a chat with a representative? Payments of the quarterly coupons are done by a Swiss company, audited by a firm in the Cayman islands?

Thanks,
Carl.
 
You might very well think that ... It does sound similar

No one can guarantee this sort of income without risking capital. There’s always a catch.

Ignore the headline rate and the friendly representative. If a relative told you they were considering an investment opportunity with the geographical structure you've described in your post, you'd tell them to run a mile.
 
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