Square Mile boiler room busted by police – When will people learn?

Three men were arrested yesterday on suspicion of running a boiler room scheme. Why in Gods name do people still fall for these scams?

Scam
A total stranger rings you up, you’ve never heard of them before and they offer you a fantastic investment, the returns are great, it’s something that you have to act upon quickly as there is only a small window of opportunity and you need to invest a ‘not insignificant’ amount of money. I really cannot understand why an individual’s ‘it’s too good to be true’ or ‘why are they offering this to me’ alarm bell is not ringing so loudly in their ear that they cannot think let alone hear anything.

This scheme seems to have been about investing in wine, claiming that the return would be between 8 and 40% on their investments. It appears that 39 victims have been identified so far with estimated losses totalling over a million pounds; that averages at over £25,500 each. Some of the victims weren’t even aware that they were victims of fraud.
I understand that the scammer has a wonderful patter and I’m sure they sound completely plausible. But it is so frustrating because if you have that sort of money to invest why, oh, why not speak to an independent financial adviser? Someone that you can actually see if needs be, someone who will discuss risk and only recommend investments that are within your risk parameters. Someone that you can go back to in the future and find out how your investment is doing and someone who will give you time to think about the investment not rush you into a decision?

I can only assume that there is an element of ‘red mist’ that the ‘greed devil’ that we all have, pops up and logic goes out of the window. “Lucky me for being given this opportunity and the young man sounds so nice, I’ll invest, how wonderful it will be to get such brilliant returns and good the wine is going to taste.”

One part of me thinks that anyone that is so stupid to fall for this patter and invest with a total stranger, deserves the result of what happens. However I am all too aware that many of the victims are elderly, remembering a world where people could be trusted. These scammers are criminals they don’t care who they hurt in their attempts to make money. They don’t care about the long term financial or mental effects of their actions. They are just selfish, uncaring individuals who will steal from anyone in order to satisfy their own greed and laziness to obtain money by any means.

Don’t be a victim, don’t let your parents be victims. Be warned that genuine investment advisers do not cold call, they do not offer ridiculous investment returns and they do not offer you something that is only available for a day or two. If you are interested in investing talk to an adviser, then you can check their credentials with the Financial Conduct Authority (FCA) everyone who is authorised i.e. is genuine, will be registered with a unique number and the register can be checked by the general public. Whilst you might think you will miss out on the amazing returns it will save you money in the long run.

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