Two men have been arrested following a Financial Services Authority (FSA) investigation into a suspected multi-million pound boiler room swindle in what is the first criminal investigation of its kind.

Addresses in North Yorkshire, Hampshire and County Durham were last week raided by FSA investigators, City of London Police and local police in connection with Universal Management Services (UMS).

UMS is suspected of helping boiler rooms and this is the first time the FSA has used its power to launch a criminal investigation into the activities of sham brokers.

Up until now the watchdog has used its powers to shut down UK firms suspected of assisting boiler rooms. This has been followed by civil actions to try and reclaim investors’ lost money.

The FSA investigation into suspected criminal offences by UMS followed complaints of cold calling and high-pressure selling where consumers were told by known boiler rooms to make cheques payable to UMS.

Over a 12-month period UMS and related organisations GS Asset Management and Continental Administrative Services sent more than £5 million of investors’ money overseas.

Assets worth up to £5.5 million have been frozen. Any customers of UMS are being asked to contact the FSA consumer contact centre on 0845 606 1234. No one has yet been charged in relation to the investigation.