Investment scams and get rich schemes

Nishan WIMALACHANDRA- Corporate Trainer, Lecturer

For those living in Sri Lanka, investment scams, Pyramid type or Ponzi type financial get rich quick scams are not new. But our focus is now on internet based fraudsters who lure innocent people into getting into financial investment scams due to their mere ignorance. Today the internet has become a very useful tool for many thieves who are IT savvy to fool anyone including the ones who are educated.

This write up comprises genuine stories and incidents where people are constantly abused by these fraudsters on regular basis. There are numerous scams, starting from marriage proposals, investments, bank transfers, donations, lost baggages, green card lottery, hidden treasures and the list goes on.

There is an enormous amount of internet sites which bring investors and entrepreneurs together in various forms. The purpose of these sites is to bring a genuine link among investors and businessmen thereby helping them in certain third party matters and thereby charging a commission etc. But to the dismay of most of those, these forums are mainly abused by fraudsters who may con even the skilled businessman in a subtle manner, and once conned by them, there is no turning back.

Entrepreneurs' must keep in mind that such fraudsters have hosted websites with supposedly very genuine information and registrations. They display their contact details and addresses and the activities they are doing in a very public manner, so that even to the suspecting mind this looks very genuine.

They deal in millions of dollars, and their rate of interest is always lesser than that of secular financial investors. These fraudsters are often well educated in economics, management and marketing and know very well of the countries laws pertaining to their fraudulent activities. They are equipped with legal practitioners, fiduciary agents, logistics providers, bankers who seem to be very genuine and helpful to get these transactions across to the unsuspecting business persons. They constantly communicate through email or phone and build trust with the entrepreneurs. Very often, they send signed legal documents with watermarks of their courts or legal practitioners' contact details and registration numbers, which further add to their masquerade.

One such genuine incident is a response received from Ghana for an advert posted by a Sri Lankan looking for an investor to set up an international school in Sri Lanka. The communication was well received by the Sri Lankan businessman, and the initial proposal was emailed, and after a few days comes another communication that the profit share will be as follows and the investor needs to be able to take away the investment after ten years. Now this is an investment exceeding few millions of dollars, enabling the businessman to have a stake of 40% for the setting up and running the show which makes this even more attractive. The investor then agrees to visit Sri Lanka to inspect the proposed site of construction etc. At this juncture, the relationship among the investor in this case a Reverend Peter Sogbe of RainbowOrphanages (www.rainboworphanages.org) and the businessman becomes very close where the Reverend starts praying to God that the business will work out fine and invoking blessings on the family of the businessman. Now the relationship is at a higher level of trust and loyalty.

At this time, the investor disappears for a week or so without any communication which makes the businessman rather confused and wanting to talk to the Reverend more.

But at the opportune time the investor calls back from a long trip away from his motherland Ghana for a serious banking issue relating to the fund transfer and apologizes for the inconvenience caused by his absence. He then assures that no matter what happens the fund transfer of millions of dollars will take place within the following weeks, and requests identity documents and other related documents such as copies of business registration documents from the businessman to finalize the fund transfer along with bank details.

All is well, the businessman is eagerly waiting for a response for the next few weeks, and nothing happens to his disappointment, and when inquired, the investor replies that they must open a bank account in Ghana in the businessman's name so that it will be easier for things to carry on, as due to the magnitude of funds, they may need multiple accounts, and assures that somehow on a particular day he will transfer the funds to the Sri Lankan's account which is supposed to be opened.

The day of the transfer comes, and suddenly a call from the Reverend reveals that a transfer of US $ 3,000 is needed from Sri Lanka to open the bank account and that it has to be done using Western Union, and he says that due to the exigency of the situation, a bank draft, Telegraphic transfer will be complicated, and that if the Sri Lankan businessman wants the funds to be transferred the only way is to send him US $ 3,000 through Western Union. Nothing could be done about this, no matter the excuses given, he needs funds to be transferred only through Western Union and explains how urgent it is. So comparing the magnitude of millions of dollars, the businessman agrees to send the money. And once the funds are sent, the investor disappears forever. No fund transfers, or no investments, no calls. And the businessman loses the money, and gets nothing in return.

A similar story was heard by another Sri Lankan who had advertised in a foreign magazine to sell his property in Sri Lanka worth millions of dollars who had been contacted by a similar party from the UK. Now the story is the same, but different names, and different phone numbers. We are in a situation that just because a foreign company has hosted a classy website, along with contact numbers to believe that they are genuine. Very few people who use the internet know how to identify fraudsters from their websites and contact numbers. Today technology is developed largely that most online activity could be monitored. And any firm which hosts a website could be tracked without any difficulty using tools such as http://www.namecheap.com/domains/whois.aspx where entering the website could give most information about the registrant of that domain and thereby track fraudster in seconds. If the fraudster uses telephone numbers, they could be tracked with so many other scams linked online, sometimes the names of fraudsters change, but their phone numbers remain unchanged. If their phone numbers are typed on a search engine, anyone will find these numbers with different names in different locations.

Last not the least story was from a chef who got a job offer from the UK based job agency as he applied for job listings for chefs in the UK online. This is an experienced chef with several years of experience in Europe. To his surprise and misfortune, he got a fabulous job offer from this restaurant in London for a larger salary. After a thorough telephone interview, he was sent his contract papers to be signed along with a letter to be forwarded to the British High Commission in Sri Lanka. All documentation looked genuine, he even talked to the head chef of the restaurant few times for clarifications on his job offer, all was clear. At this time the job agency sent him confirmation of employment with the restaurant with a duplicate set of the documents sent from the restaurant saying that since he was selected, and that his salary was some 18,000 GBP, to now pay 2000 GBP as processing fee for finalizing some legal documentation to confirm his work permit. So the Sri Lankan chef delightedly agrees to pay the money and is asked to send it through Western Union. Chapter closed, no job was ever offered to him and to his dismay, that restaurant was never in existence in London and all documents he received from the restaurant and the tele-interview done was all a hoax well staged by the same party who advertised for the job vacancy in the UK. If you are someone who had been contacted by such fraudsters, it's best not to encourage communication. They may not be able to get any money from you if you were smart enough. But they may steal your identity along with your real details, and may pose as you in another country to con people. It is best that we familiarize with the internet and how things work online. Just because most of us are good at posting comments such as 'OMG', 'Lovely pix' on social networks, it's time we learnt how fraudsters could take away our hard earned money. The best way to deal with such investment proposals are to ask as much questions as possible and get advice from local financial institutions on the viability of the information as well as how practical such fund transfers are. For those who apply for foreign employment on the internet, one caution must be made, that is to beware of many fraudsters posing as employment agencies online.

(The author could be reached via [email protected])