The Financial Conduct Authority (FCA) is calling for information from individuals or businesses with knowledge of a scheme promoting shares in Emmit (EMT:AIM), a smallcap security blinds installer.
The regulator is investigating claims that people were encouraged to transfer money from their work pension schemes into Self-Invested Personal Pensions (SIPPs) and then buy shares in the stock, listed on the Alternative Investments Market (AIM). The London Stock Exchange suspended trading in the stock as a precautionary measure on 17 October.
Emmit generated no revenue last year and its liabilities exceed its assets. But at 97.5p, the price at which the shares were suspended, it had a market capitalisation of £17.8 million after a dramatic 1400% increase in the share price in the year-to-date.
The FCA says between 60 and 100 investors may have been affected, investing as much as £4 million in total. These transactions dramatically increased demand for the shares, driving them to levels as high as 200p over the summer. Some investors may have invested their entire pension pot into the stock, the regulator says, incentivised by claims regarding the value of the shares and cash payments as high as 30% of the value of their pension.
The FCA says there is currently no indication that the scheme involved Emmit itself. Individuals with information on the scheme or who hold shares in Emmit should call the FCA’s freephone number 0800 1116768.