| 1. | a room in a building, ship, etc., that houses one or more steam boilers. |
| 2. | Slang.
|
| boiler room n.
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Boiler Room
Investopedia Commentary
A broker using boiler-room tactics gives customers only positive information about the stock and discourages them from doing any outside research. Boiler-room salespeople typically use catchphrases like "it's a sure thing" or "opportunities like this happen once in a lifetime".
Boiler-room methods, if not illegal, clearly violate the National Association of Securities Dealers' (NASD) rules of fair practice. The North American Securities Administrators Association estimates that investors lose $10 billion a year - roughly $1 million an hour - to investment fraud promoted over the telephone.
Related Links
Investment Scams Tutorial
Understanding Dishonest Broker Tactics
See also: Broker, Bucketing, Churning, Circular Trading, Cold Calling, Dialing and Smiling, Front Running, National Association of Securities Dealers - NASD, Penny Stock, Pump and Dump
boiler room