The Great Jock n Roll Single

Jocknroll · Posted: Fri Mar 30, 2007 7:04 pm Post subject: Steer Clear of Scams

http://www.fool.co.uk/news/your-money/manage-your-finances/2007/03/29/steer-clear-of-these-scams.aspx?source=ioowftxt0010011

Last week, someone left a note under the windscreen wiper of my wife's car which simply read "CALL ME" above a number which began '07XXX'. Naturally, I laughed and threw this piece of rubbish into the recycling bin!

As I'm one of the last remaining adults in the UK not to own a mobile phone, I couldn't be sure how much it would cost me to call this number. However, I know that numbers beginning 07 indicate mobile, pager and personal numbers, which can be very pricey to call. My senses told me that this was some kind of scam, so I binned the note.

Although I ignored this rather feeble attempt to separate this Fool from his money, I'm constantly on the lookout for more sophisticated scams. Indeed, thanks the joys of the Internet, not a day goes by without me receiving some kind of 'scam spam' promising me untold riches in return for a modest upfront investment. Here are seven swindles which promise a great deal more than they deliver:

1. Premium-rate telephone rip-offs
Personally, I have a real aversion to calling non-geographic numbers, so I stick to calling freephone numbers (0800 and 0808) and UK numbers which start with '01' or '02'. Nevertheless, premium-rate numbers flourish, offering everything from horoscopes to adult entertainment to big prizes -- at a cost of up to £1.50 a minute for 090 numbers.

If I were running the country, I would move quickly to ban those awful competitions and scratchcards which charge upwards of £1 as an entry fee. Recently, the news has been full of revelations about the shady (and downright fraudulent) practices of those production companies which make TV quiz shows and run phone-in voting lines. Frankly, your chance of winning is miniscule, but you could lose a fortune if you get hooked on these services. Avoid at all costs!

2. Advance-fee frauds and fake lotteries
Advance-fee fraud (also known as the Nigerian or 419 scam) works like this: you are promised a massive pay-off, usually millions of pounds, in return for a modest one-off fee or the use of your bank account. Usually, the conmen explain that this fee will be used to bribe corrupt officials, or to meet bogus customs duties or taxes.

Of course, what really happens is, at the first available opportunity, fraudsters will steal your life savings or empty your bank account. All the while, they will dangle the promise of a fortune there for the taking. Another variation on this theme is the fake lottery. Ask yourself, how can you possibly win a foreign lottery for which you've never even bought a ticket?

3. Boiler rooms
Watch out for calls from convincing salespeople urging you to invest in little-known stocks and shares. On almost every occasion, these calls come from boiler rooms which dump worthless or fictional shares on unsuspecting victims. That hot stock promising huge returns is sure to wipe out your savings, so don't take the bait -- hang up immediately.

By the way, I know several investors who have been cold-called recently with offers to buy their small-company shares at vastly inflated prices. The catch is that they have to pay a fee to access this 'exclusive buyout', so this is simply another variant of advance-fee fraud.

Only firms regulated by the Financial Services Authority can offer investment services to the British public. You can check a firm's registration here.

4. Make a Million seminars
Am I the only person who is utterly fed up with get-rich-quick advertisements which promise to make me a mint by investing in property or shares? The only people who get rich from these courses are the organisers, who charge thousands of pounds for their 'inside secrets'. Often, these foolproof tips turn out to be basic common sense, or even complete hogwash. If you want to learn how to be a better investor, you'll find all that you need here on the Fool website!

5. Phishing emails and calls
Watch out for emails which appear to have been sent to you by a financial firm of which you are a customer. The same goes for callers who claim to represent your bank or credit-card company. In most cases, these 'phishing' attempts are aimed at grabbing personal or financial details in order to defraud you. So, don't click on links in these emails; instead, delete them straight away. Also, if you're not sure about inward calls from your bank, call it back on the usual number. For more advice, visit the Bank Safe Online website.

6. Ponzi (pyramid or matrix) schemes
In 1920, a large number of Americans were conned by a now-infamous trickster called Charles Ponzi. Ponzi raked in millions from investors who were taken in by his promise to turn $100 into $150 in 45 days by trading in hoax 'postal coupons'. In reality, Ponzi used contributions from new investors to fund the fake returns to previous investors.

Although they have been outlawed, Brits are still being duped by similar pyramid schemes which promise large rewards for recruiting more suckers. Ignore the hype and avoid all proposals which rely solely on recruitment to generate returns -- unless you work as a recruitment consultant, of course!

7. Sham charities
I live in an area which is a particular target for charity collectors, both genuine and fake. Although I dislike the 'chuggers' (charity muggers) which confront me in the high street, I absolutely detest for-profit businesses which pose as registered charities. If a leaflet comes through your door asking for unwanted goods, check to see if the firm is a registered charity. If it isn't, then most -- if not all -- of your money will end up lining some rogue's pockets, instead of benefiting good causes. For more advice on this scam, read this warning from the Charity Commission.

Finally, these signs will help you to watch out for scams which prey on greed and ignorance:

1. They arrive via unsolicited emails, faxes, letters or telephone calls.

2. They ask you for money before you can claim your windfall/prize/inheritance.

3. They boast of guaranteed returns well in excess of 6% a year (the interest rate paid by a top savings account).

4. They don't explain precisely how these fantastic returns are created.

5. They rely on sucking in progressively more people in order to pay out and keep going.

6. They claim secret 'insider' knowledge (this is always the case for gambling and boiler-room scams).

7. They promise huge rewards in a short time with little effort (particularly home-working scams).

So, remember: guarantees of easy money are nothing but empty promises, and are sure to be phoney. Keep your wits about you at all times!

More: Visit the Office of Fair Trading's Scambuster website, the Canadian Crimes of Persuasion website, and our Financial Scams discussion board.
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Jocknroll · Posted: Fri Mar 30, 2007 7:07 pm Post subject:

From the Charities Commission Website:

Thursday 14 December 2006 16:35
Office of Fair Trading (National)

OFT warns don't get scrooged at Christmas!

As Christmas approaches, the OFT is urging the public to be on the lookout when giving to charity and not to get caught out by scrooges (otherwise known as bogus charity bag collectors) who prey on people's good will to fill their own pockets.

Attracted by the rising prices paid for second hand clothes, bogus charity bag collectors, many with links to the Baltic States, have increased in number and are even prepared to steal donations left out for genuine charities.

The Association of Charity Shops estimates that over £2 million worth of potential donations are lost each year to bogus charity bag collectors. Many genuine charities rely on doorstep collections for a large part of their shop sales and for many households, donating unwanted items is the most generous way they can support their chosen charities.

Clothes Aid is an organisation which collects doorstep donations for children's hospitals across the UK, including Great Ormond Street Hospital Children's Charity (GOSHCC) and Alder Hey, the largest children's hospital in Europe. They estimate that GOSHCC alone has lost £220,000 per annum to bogus charity bag collectors. GOSHCC bags attract upwards of £500 for one tonne of donations on the black market and it is believed that up to 30 truck loads leave the UK every month destined for Lithuania alone. As a result, Clothes Aid has employed a team of 'motorcycle guardian angels' to patrol and protect collection areas and report thefts to the police.

The OFT has worked closely with the Charity Commission, Local Authority Trading Standards Services and the Advertising Standards Authority to crack down on the bogus charity collectors.

However, many of the recent collection leaflets give the misleading impression that the collections are on behalf of charity, but hidden in the small print they often admit that, in fact, donations are being collected for commercial purposes. The leaflets often include fake address or registration details which make them especially difficult to trace.

If consumers have any doubts about a leaflet asking for donations, or collectors they should:

* contact the Charity Commission helpline on 0870 333 0123 to check whether the collection is for, or on behalf of, a registered charity,
* give directly to a local charity shop or donate to a charity shop collection sack, which should make clear reference to the charity registration number and many will also carry the Association of Charity Shops Code of Charity Retailing logo, or
* contact the local police to report concerns or evidence of theft of donations to genuine charities.

Christine Wade, OFT Assistant Chief Executive, Consumer Advice and Trading Standards, said:
'It is deplorable that some people actively cheat genuine charities out of significant sources of revenue and deprive those most in need of donations. We want people to be confident that they can give to charities but they should be careful to avoid unscrupulous individuals and companies looking to exploit their generosity and goodwill.'

David Moir, Head of Policy and Public Affairs at the Association of Charity Shops, said:
'House to house collections remain an effective way to donate and we urge members of the public to continue their generous giving, but encourage them to exercise caution and vigilance. Legitimate charities take great care to get their message across. If a leaflet doesn't look or sound right it probably isn't.'

Michael Lomotey, Head of Collection Protection at Clothes Aid, said:
'Clothes Aid is working with the police and Trading Standards to stamp out this problem and thanks to the vigilance of members of the public we have already successfully prosecuted people for theft of clothing donations. Nevertheless we urge the public to continue to give
in this way but if they notice anything suspicious to dial 999 immediately.'

NOTES:

1. The Control of Misleading Advertisements Regulations (CMARs) 1988 (as amended), largely implement EU Directives on misleading and comparative advertising. They aim to protect the interests of consumers and businesses from misleading advertisements and advertisements that make prohibited comparisons.

An advertisement is misleading under the Regulations if in any way, including its presentation, it deceives or is likely to deceive the person to whom it is addressed or whom it reaches and if by reason of its deceptive nature, it is likely to affect their economic behaviour, or for those reasons injures or is likely to injure a competitor of the person whose interests the advertisement seeks to promote.'Advertisement' for the purposes of the Regulations means any form of representation which is made in connection with a trade, business, craft or profession, in order to promote the supply or transfer of goods or services, immovable property, rights or obligations.

The OFT can take action against anyone appearing to be concerned or likely to be concerned with the publication of a misleading advertisement. It can apply to the courts for an injunction ordering such persons to comply with the law in future. It can also accept undertakings from those involved in lieu of action.

http://www.oft.gov.uk

PUBLIC enquiries: 0845 7224499 enquiries@oft.gov.uk
OFT reports and consumer information leaflets are available free from:
OFT, PO Box 366, Hayes UB3 1XB 0800 389 3158 oft@ecgroup.uk.com

Client ref 177/06

GNN ref 142070P
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