Top 10 Consumer Swindles

[minkyrra]

Telephone lottery scams: These include the Canadian lottery scam and the El Gordo Spanish lottery scam, which deceptively uses the name of a genuine lottery. People respond to an unsolicited mailing or telephone call telling them they are being entered into a prize draw. They then receive a telephone call congratulating them on winning a big prize in a national lottery - but before they can claim their winnings, they must send money to pay for taxes and processing fees. The prize does not exist.

Prize draw, sweepstakes and foreign lottery mailings: Many typical scams take the form of prize draws, lotteries or government payouts. Most appear to be notification of a prize in an overseas draw or lottery in return for administration or registration fees.

Premium rate telephone number scams: Notification by post of a win in a sweepstakes or a holiday offer includes instructions to ring a premium rate 090 number to claim your prize.

Investment-related scams: This often involves an unsolicited telephone call offering the opportunity to invest in shares, fine wine, gem stones or other soon-to-be rare commodities. These investments often carry very high risk and may be worth a lot less than you pay. The shares are not quoted on any stock exchange and you will not be able to sell them easily afterwards. "Solid'' valuable investments, such as gem stones, are often said to be stored in secretive Swiss bank vaults, so you can never see your investment

Nigerian advance fee frauds: -Often an offer via letter, email or fax to share a huge sum of money in return for using the recipient's bank account to permit the transfer of the money out of the country. The perpetrators will either use the information given to empty their victim's bank account, or convince him or her that money is needed up front for bribing officials.

Pyramid schemes: Offer a return on a financial investment based upon the number of new recruits to the scheme. Investors are misled about the likely returns as there are not enough people to support the scheme indefinitely - only the people who set up the scheme are able to make any money.

Matrix schemes: These are promoted via Web sites offering expensive high-tech gadgets as free gifts in return for spending £20 or similar on a low-value product such as a mobile telephone signal booster. Consumers who buy the product join a waiting list to receive their free gift. The person at the top of the list gets their free gift only after a prescribed number - sometimes as high as 100 - of new members join up. In reality, the majority of those on the list will never receive the expensive item they expect.

Credit scams: This is another advance fee fraud, originating in Canada. Advertisements have appeared in local newspapers offering fast loans regardless of credit history. Consumers who respond are told their loans have been agreed but before the money can be released they must pay a fee to cover insurance. Once the advance fee is paid, the consumer never hears from the company again and the loan never appears.

Property investment schemes: Would-be investors attend a free presentation and are persuaded to hand over thousands of pounds to sign up to a course promising to teach them how to make money dealing in property. Schemes may involve the opportunity to buy properties which have yet to be built at a discount. A variation is a buy-to-let scheme where companies offer to source, renovate and manage properties, claiming good returns from rental income. In practice, the properties are near derelict and the tenants non-existent.

Work-at-home and business opportunity scams: These often involve the advertising of paid work from home that requires money up front to pay for materials, or by requiring investment in a business with little or no chance of success.

Christine Wade, director of consumer regulation enforcement at the OFT, said:
"We will continue to work with our partners within the UK and overseas to enforce the law against perpetrators of these misleading and fraudulent schemes, and to provide the public with the knowledge and skills they need to recognise these scams.''

from aol

[swopmebob]

Minky,you workin ur socks off to get some intrest going in here.Well done.

[exonia]

Christine Wade, director of consumer regulation enforcement at the OFT, said:
"We will continue to work with our partners within the UK and overseas to enforce the law against perpetrators of these misleading and fraudulent schemes, and to provide the public with the knowledge and skills they need to recognise these scams.''

All they do is put a few warnings on some websites, very little real action on anything internet related.

From the contact i have had with the govenment agencies, unless the fraud or scam involves 10's of £1000's, they are not interested.

Pyramid/matrix scams, there has not been a single prosecution, just shows how hard they are working to protect the public.

[thehoneyant]

All they do is put a few warnings on some websites, very little real action on anything internet related.

From the contact i have had with the govenment agencies, unless the fraud or scam involves 10's of £1000's, they are not interested.

Pyramid/matrix scams, there has not been a single prosecution, just shows how hard they are working to protect the public.

I don't think so.

The Office of Fair Trading has issued e-mail alerts to 100 potentially misleading Web sites offering "get rich quick scams", warning them that they could face prosecution. The scambusting clampdown was part of a co-ordinated sweep of the Net conducted by authorities in 27 countries and led by the US Federal Trade Commission. In all, consumer organisations around the globe identified 1600 sites during operation GetRichQuick.Con. Officials trawled the Net for three hours searching for bogus homeworking schemes, business and investment opportunities, lotteries, pyramid and multi-level marketing plans, money-making clubs and chain letters. John Bridgeman, DG of Fair Trading, said: "People should be wary of claims that large amounts of money can be earned for little or no effort in an extremely short timescale." "If something sounds too good to be true, then it probably is," he said. Officials will re-visit all 1600 sites in a month to see whether any improvements have been made. If not, consumer organisations will consider launching investigations, which could lead to prosecutions. This is the third time the OFT has taken part in a sweep of the Net looking for "dubious" sites.

companies have been prosecuted, fined, or shut down for pyramid scheme fraud. I have had extensive opportunity to investigate these product-based schemes, having served as expert witness cases brought against pyramid scheme perpetrators.

We must be reading different books.

[exonia]

Only one matrix related company has been wound up under the insolvency act, not because it was a pyramid/matrix site.

I do understand a few sites received a warning, this was in the main about the wording of their T&C, like they had to offer a 14 day money back guarantee to comply with the DSR (distance selling regulations).

In real terms, very little has been done.

[thehoneyant]

Only one matrix related company has been wound up under the insolvency act, not because it was a pyramid/matrix site.

I do understand a few sites received a warning, this was in the main about the wording of their T&C, like they had to offer a 14 day money back guarantee to comply with the DSR (distance selling regulations).

In real terms, very little has been done.

Oops sorry, I thought when you said "From the contact i have had with the government agencies," I thought you would have known for definite.

Ahhh but how many of the 100 potentially misleading Web sites, no longer exist because of the warning.? In the long term it saves the money that would have been needed for trials etc., If we can't find out, we will never know.
Unless of course a question is asked under the new freedom of information act.

[exonia]

Well, govenment agencies are like politicians, very reluctant to give anyone a straight answer, but i do know that one member of parliament is taking a keen interest in the matrix scam.

Since xmas, i have seen 11 matrix sites close, 2 have reopened with new names and hosting companies, and one of them has just been closed again.

I have found that the best way to close these sites is to report them if they use paypal, reporting a site thats owned by a company to either the DTI, OFT, or trading Standards is a waste of time.

One site claims to be taking about £160.000 a year, i have no way to verify this, but it could be true, and thats just one of 100's that are uk based.