A “boiler room” shares scam centred on Birmingham that left 350 investors high and dry has been wound up in the High Court following an investigation by the Insolvency Service.

The probe by the Companies Investigation Branch found that three companies had generated more than £763,000 from members of the public who were subjected to high-pressure sales techniques.

The Insolvency Service said that shares in Fingerpin International plc, a company that acquired the business of its predecessor Fingerpin Ltd when that company ceased to trade due to mounting debts, were sold to members of the public through a network unauthorised and unregulated network of offshore share-selling agents.

These included European Investment Group, a broker whose unauthorised status is subject to a Financial Services Authority alert.

“The share-selling agents, commonly referred to as ‘boiler room operators’, sold 8p stock in Fingerpin plc for a typical price of £1.30 per share, and in the process pocketed most of the remaining balance of £1.22 per share in commissions and fees,” the Insolvency Service said yesterday.

Some of those fees were received by TDR Consulting Limited, the UK-based agent responsible for collecting and banking Fingerpin plc share sale proceeds.

“The use of TDR to bank sales proceeds was a sales tactic used in part to give assurances to members of the public that they were dealing with UK-based businesses,” the statement went on to say.

“Fingerpin had been set up to develop biometrics software that would allow fingerprint sequencing to be used as a security access device as an alternative to using passwords. The company did not achieve any successful commercial exploitation of this.

“After Fingerpin spent £500,000 of funds raised through a network of investors, an agreement was entered into with GKM Investment Holdings Limited in an attempt to raise further working capital.

“It was claimed that GKM was registered in the British Virgin Islands, although no company of that name has ever been registered there.

“The investigation found that TDR had received over £763,000 from members of the public who had purchased Fingerpin plc shares through unauthorised share-selling agents. Of this, only £31,000, or four per cent, found its way to the Fingerpin companies.

“Fingerpin plc had ceased trading by September 2007, following its eviction from trading premises at Brindleyplace, Birmingham.

“It left a trail of 350 shareholders together with trade and Crown creditors in its wake, none of whom had been notified at the time or subsequently that the company had ceased to trade.”

According to the City of London Police, British investors are being tricked out of at least £500 million a year by illegal boiler room share-pushers peddling virtually worthless stock.

City watchdog the FSA recently launched an international campaign to crack down on boiler room operators and to educate consumers about the dangers of trading with them.