East Midlands

It’s a story that’s taken Jeremy Ball from West Virginia, USA to southern Spain and taught us just how careful we should be when we pick up the phone.

Easy money

When Nick Atkins’ phone rang the man on the other end sounded persuasive.  He was selling shares in an American company called Tycon Energy.

Nick Atkins: "no such thing as a free lunch"

"It was into oil exploration, ideal for takeover,” Nick from Lincolnshire told us. 

"The shares were being sold at three dollars. They were going to be floated at a four dollar price.

"So I just thought it was a way of making quick easy money.

"But there’s no such thing as a free lunch."

Nick’s got his share certificate – the problem is he can’t sell his shares. 

A certificate but can't sell the shares

Tycon has issued millions of shares. They’re listed on Frankfurt’s unofficial open market, which isn't subject to the high Europe-wide transparency standards found on other EU exchanges. 

Father of one Johan spent £10,000 on Tycon after he had a series of calls promising the price was about to go through the roof. 

He too found it impossible to sell his holding. 

Now he thinks his money has gone for good and he’s lost everything:

"None of the promises came true... We can’t even get hold of the people now. 

"I’ve got nothing left, absolutely nothing.

"I told them I had a newborn son.  This is money I saved for my little boy."

Tycon Energy

So what is Tycon Energy Corporation?  

Flashy website

They’re not to be confused with another firm with the same name based in Edmond, Oklahoma. 

This company has a flashy website complete with an address in Las Vegas and maps of exciting plans to drill deep gas wells in West Virginia. 

Tycon says their seismic survey has identified "potentially substantial" gas reserves, they’re working with a business partner and they’re preparing to drill.

But when Inside Out investigated we found they don’t have a current right to drill, we couldn’t find anyone in authority who’d ever heard of Tycon and they’re not yet registered to do business in the state.

Ambro

BBC Inside Out received a tip off. 

We were told the man behind Tycon Energy was from Nottingham – and he worked from Spain running a team of cold callers working for an investment research company called Ambro.

We headed to an industrial estate outside Marbella to an anonymous unit with the shutters down. 

Insiders who’d worked there told us that many were recruited from adverts in local papers. 

A worker describes what it's like to Jeremy Ball

Behind the shutters our insiders painted a picture of a room with rows of telephones, lists of the phone numbers of prospective investors and open use of cocaine by workers.  

One described the way it worked.

"You’re led to believe this is a legitimate company. But when you get there, within days you realise it’s not. 

"We’re having to lie on the phone.

"Pretending to be Ambro, then it’s Tycon. 

"Everybody’s got a false name.

"We don’t get wage slips. We don’t pay tax, National Insurance, nothing."

FSA warning list

So were Tycon and Ambro really one and the same? 

Suspicions aroused we investigated the computer which hosts Tycon’s website. 

The same computer address hosted just two other websites - one for Ambro Investment Research AG and one for another company called Fidelis-Swiss which according to our investors also sold Tycon shares.

Ambro is on the Financial Services Authority (FSA) warning list which includes unauthorised overseas firms that people have complained about. 

The FSA says "such firms are often involved in 'boiler room' activities and pose a high degree of risk to consumers." 

Tycon’s lawyers told us the websites may be hosted on a common server. 

They admitted Tycon had used Ambro to promote their shares but had severed links when they realised it was an unauthorised company. 

And they denied any connection with any other unauthorised firm.

Fraud expert Paul Barnes from Nottingham Trent Business School told us what we’d uncovered had all the hallmarks of a classic "Boiler room" – a term used to describe an operation where shares are sold by telephone using high pressure tactics and misleading information. 

"The question here is whether it’s a real business, or a device to extract money from investors,"  Paul told us. "And it would appear to be the latter."

Claims denied

BBC Inside Out spotted Tycon Energy’s Vice President Chris Burton leaving the industrial unit outside Marbella. 

Since his company is based in Nevada we wondered what he was doing in Spain. 

Chris Burton leaving the industrial unit in Spain

We approached him on the street and asked him to answer our questions on behalf of investors but he declined to comment and drove off. 

He later told us he had been paying an invoice at the unit. 

He emphatically denied that he controlled a team of cold callers and told us that claims of false names, drug use and avoiding tax are all unfounded. 

We will now be passing what we know to the police and the Financial Services Authority to see if they think investors have been misled.

Boiler rooms – the bigger picture

Inside Out spoke to Detective Superintendent Bob Wishart, the detective in charge of tackling suspect share-dealing.

Det Supt Wishart: 'significant threat to UK'

He says that nationally boiler rooms cost British victims an estimated £500m a year. 

"It’s a massively devastating crime…

"It’s no different from a robber walking up to a little old lady in the street, pointing a gun and stealing £10,000.

"The victim suffers the same sort of trauma.

"We believe it’s a significant threat to the United Kingdom."