You don’t have to be a genius to work out how the investment sales rip off works.
It can be seen on websites on a daily basis. It usually involves an offer just to good to be true.
The scam or con or rip off or dupe usually involves a snazzy website, which shows a portfolio of investments such as properties, hotels, holiday complexes, anywhere really where sales can be made to investors based on a return over X years.
We have been following one or two of these scammers over the years and we would like to believe that we have played a small part in their demise through some due diligence checks, a bit of research and snooping, I.e good old fashioned investigative journalism.
One such scheme landed on the green and pleasant county of Carmarthenshire with promises of returns for investors on rooms at a plush hotel/holiday complex. Safe to say investors took a fall for quite a lot of cash.
Not content with taking a large number of people for a ride once the operation moved to the fair county of Gloucestershire and pretty much did the same thing there. Millions lost again. Fraud? A custodial sentence for the perpetrator/s? Not so, a ban from being a director was the sum total of the punishment.
Theses characters are usually quite charming. They are good at creating a front and they know where to set up. Wealthy well to do people flock around at the latest chic venue in awe of what they see. No expense spared. It becomes the place to be seen. Embed yourself by donating a few bob to the local choir and host a few events for the WI or knitting club, just schamooze those who look like they boss the village or town.
Meanwhile make sure this respectable front is busy creating the honey trap for yet more investors. The website and social media pages have to show a successful venue and the price list reflects the kind of money one would expect to be taken by that business. To the innocent investor it all seems above board and a win win situation. They invest £x in a room and benefit from the cash generated from guests. Call it a ‘room timeshare’ for want of better words.
Lurking in the background in all this there may be others from a less than savoury background running other operations. Multiple businesses are set up and registered and cash passes through the businesses making it difficult to trace exactly where it has gone and who is who.
The innocents in all this are the staff who work at the venues and the suppliers of goods and services who in time will find that their bills have not been paid. This will go on long enough until someone somewhere outs the scammer and it becomes public. By then the suitcases are packed, companies are dissolved and names are changed.
You can go banging on any door you like but you won’t find the people responsible. There are of course signs you can look out for. Check out the social media pages of these sharks. They usually present themselves as successful people. Look at me, I have all this and you can too. They have usually convinced gullible locals who won’t hear a bad word said against them.
If you can’t beat them join them. Get yourself enough people to buy a hotel or find a criminal source to fund it. Create the website and social media and offer rooms to investors with the promise of a great return. Convince the gullible local council that you are legitimate and that they are lucky to have you in their county. Make sure you demand a few hundred thousand pounds in funding because you are going to/NOT invest millions in the venue, a golf course, football and rugby teams using the place, a premiere wedding venue or any old rubbish you can get away with. Why you could even fill the place with undesirables as long as the cash comes in from somewhere and you don’t have to answer any questions from nosey/reputable journalists.
Advertise for staff and make sure they idolise you but don’t give them any information on what you are really doing. If anyone dissents just hire others and say they were guilty of ‘gross misconduct’. No one will believe a word they say from then on. Use the local media and spin the biggest pack of lies you can come up with. They just love these stories and will run features on you and the venue. This cements your legitimacy for investors looking in.
Have an escape plan. Make sure that no stone is left unturned so that when you cannot get away with blue murder anymore you can just hop into another county and do the same thing all over again. No one exchanges information despite the advent of the internet, not least newspapers and councils.
So there you have it. Our complete guide to buying an hotel or chalets in a foreign country or a golf club, etc and scamming investors. Good luck with it all and remember the Press love you.