The Cyprus Securities and Exchange Commission has today issued another warning to investors about the risks associated with unauthorised investment providers. These warnings are often aimed at protecting consumers from fraud, scams, and other forms of misconduct by unregulated or improperly regulated brokers.

The latest addition to the CySEC warning list is a new clone scam posing as Berkshire Hathaway Inc., a multinational conglomerate holding company headquartered in Omaha, Nebraska, USA. The company was founded in 1839 by Oliver Chance and later acquired by Warren Buffett in 1965. Since then, Buffett has transformed Berkshire Hathaway into a diverse portfolio of companies with interests in industries ranging from insurance and energy to retail and media.

CySEC stressed that these companies are not licensed to operate brokerage businesses in Cyprus and are not affiliated with regulated entities. In addition, it warned that if consumers lose money on unlicensed platforms, they will not be protected by the Investor Compensation Fund (ICF). This helps protect the claims of insured customers and provides compensation to members in the event that they are unable to meet their financial obligations.

CySEC and other global regulators have repeatedly issued alerts to warn investors about cloning scams. These alerts advise investors to be wary of unsolicited emails or social media messages claiming to be from legitimate financial institutions or regulators, and to look carefully at the website address and contact information of any financial institutions or regulators with whom they interact online.

However, the regulator said it is important for investors to conduct their own research and due diligence before investing with any broker. This includes verifying the broker's regulatory status, reading reviews and feedback from other investors.

CySEC surveyed 200 European retail investors between the ages of 18 and 55 who had directly made at least one securities or derivatives trade in November 2022.

Studies have shown that few people spend enough time researching the products they plan to invest in or the companies selling them, raising concerns that investors don't understand the risks involved. Among the retail population, one in four said they spent 6-7 days researching a specific product, and 7% said they did less than 30 minutes of due diligence before committing money to a product, or none at all.