What is a boiler room in securities fraud?

A boiler room in securities fraud is an illegal operation that uses high-pressure sales tactics and lies to convince people to buy stocks, bonds, and other securities that are either worthless or too risky for the buyer. It is usually run by unlicensed, unregistered brokers who are paid very high commissions for any investments they successfully make. These brokers will often exaggerate or make false statements about the stocks or securities in order to get people to invest in them. Boiler rooms often target elderly and unsophisticated investors, who may not know any better. They will usually cold call potential buyers and use aggressive sales techniques to try to convince them to purchase securities. Boiler rooms often rely on making a significant amount of sales calls, so the more people they are able to reach, the higher their profits. In Utah, it is illegal for any unregistered or unlicensed agent to do business with people in Utah. Any broker who is caught engaging in boiler room activities can be subject to fines and criminal charges. Additionally, investors who have been victims of securities fraud are entitled to certain remedies under Utah’s securities laws.

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What is a boiler room in securities fraud?

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