Tuesday, May 6, 2008

Con Artists' Phone Mischief--Learn How Easy it is to Spot these Investment Scams

--Gold Mines, Coins, Mortgages, Oil Wells, Commodities, and Livestock dominate the Legal Scam offerings by Con Artists, 75% of which are Telemarketed

It seems like killing cockroaches would be easier than eliminating telemarketing con artists. They seem immune. Phone Scams continue, ever on. A ten-foot pole is not long enough to separate one from these quick-buck "deals." Odd, but despite the FTC "No Call Registry," this kind of con artist action still flourishes. Come again, what kinds? Here is a sampling:

> Gold and silver mine investments. The old "dirt pile" scam seems to live forever.
(Sure, "time" is a great teacher, but you've got to recognize that it does kill off all of its students.) Another rip-off signal: claims of new, secret formulas for extracting valuable minerals from closed down, played out mines. These offerings are usually extended by the real renaissance con artist.

> Gold and silver coins and bullion. The "hook" here is usually a promise of safekeeping in the seller's (con artist's) deposit vaults. Most often, when it comes time for the sucker to cash-in his holding and cash-out of the action, he finds that no coins or bullion ever existed in the first place. Do the math. Isn't this a fraud that was obvious right from the beginning? Loopholes in these arguments quickly become nooses. For some reason the gullibility factor in this area is extreme--like expecting to see a trial lawyer with his hands in his own pockets.

> Deferred delivery and leverage contracts. Up-front payment for future deliveries of commodities is most often required for these offerings. These almost always turn out to be phantom commodities which either disappear into the night, or never existed to begin with. If you are ever tempted by such an "investment," stop. Think. If at first you don't succeed, taking up a new career of high wire walking with no net in a circus is not for you.

> Mortgages and deeds to secure debt. The "mark" in this case is tempted by the offer of interest checks, with promise--in case of default--of gaining title to property. Most of this property is so overvalued that it will not cover the cost of the investment. Also, the sucker will usually belatedly discover that the same property was sold to many other investors.
In mortgages and deeds con artists offer you many opportunities to become a self-indulgent, navel gazing victim.

> Livestock and exotic animals. These are offerings to breed and raise herds on the investor's behalf. Exotic birds, such as emus or ostriches, or their eggs, are dangled, too, as desirable investments. The meat, hides, or output (eggs) from these birds is the supposed attraction. Before investing in this kind of venture, try and recall the last time you saw ostrich eggs offered on a restaurant menu.

> New technologies. A new invention, a patent, a new hi-tech service process--these are lures which forever entice. The inside track ("Get in on the ground floor") always seems to tempt investors into big money losses. Con artists' many offered opportunities here provide ample chances for you to get quickly cleaned out and become a drooling head-banger.

> Oil and gas wells Working interests and partnerships are held forth by scam artists as great investments, along with "guaranteed" wild cat wells. Callers often offer an interest in a license issued by the Federal government to obtain the rights to drill. The deals are usually scams. The wells do not exist. Strangely, this is one of the most common con games around. This scam can only show why so many investors are here on this earth for a purpose: to serve as a warning to others.

The quick, shortcut way to insulate yourself from these legal scams--if the No Call Registry doesn't protect you--is to fall back on the wisdom of Murphy's Law: Almost anything is easier to get into than out of.

Nothing is fool-proof to a talented fool.
Hence, the short route to safe cover is to respond to such phone offers with, "Sorry, but I do not deal with telemarketers." And, hang up.


Terry said...

I see you've covered a big mess of investment scams this time. The gold and silver stuff is always around, thick as flies. But, you didn't hit platinum.

Gene Kranik said...

The way the scam horizon hits me is that it's still oil and gas wells that are the biggest lure. I get hit up all the time by these guys. Funny thing but since the 1980's when oil and gas partnerships were big, it's still the same. Don't investors realize that the environmental impact statement requirement makes it almost impossible for any of these new operations to proceed?

Ariel J said...

It is too hard to figure which of these scams is the worst, so I'm only going to cast my vote in the one-liner contest. My vote is how to avoid becoming a drooling head-banger.

Jack Payne said...

The reason I didn't cover platinum, Terry, is because it is nowhere near as pervasive as gold and silver in scams.

I recall the 1980s, well, Gene, when oil and gas well limited partnership offerings proliferated. Back then many of these were legitimate, but didn't have a chance. As soon as they sprung up, the class-action lawyers would also spring up and shoot them down.

Glad we share the same sense of humour, Ariel.

Baird said...

I like the lawyer with his hands in his own pockets.

The Muse said...

I put my cell on that list...I still get calls. If the ID says "out of area" or "unknown," I don't answer. That's how I deal with those pesky critters.

As far as my home phone goes, it's not used. We have a line only because we had to have one for the DSL. Boy those phone companies get you coming and going.

Now, how to deal with the investment junk mail: File 13.

Have a great day!

Warmer said...

Baird, the lawyer did it for me too.

Bern said...

Muse has it down cold. This is very much the same method I use to screen calls. Before that, a few years ago, I was gone after hard by some mad man wanting me to invest in ostrichs...he told me the eggs were valuable. I asked him the same thing you did, Jack, about how come you cannot find them on a restaurant menu? He had no answer.

Terry said...

I howled at the lawyer analgy...but, Jack, I don't think you really meant trial lawyers, per se, did you? From past posts you have written it sounds more like you meant class action lawyers, is that right?

Kevin Goodman said...

I don't think I've ever been hit up on the telephone with an investment proposal - exception being an area stocks/bonds investment broker who is actually rather reputable.

I get a fair share of sells calls.

My mom was good with telephone sellsmen. She was also goood at practical jokes. She would get the sellsmen talking pretending to be very interested and as he went off into a spill she would sit the phone down on the window ledge and quitely walk away with a smile.

Dolcett said...

This whole thing is so puzzling, I mean the magnitude of it. There are so many scams in all directions, and I do think the psychology behind these is close to political activity. How can you divorce the two? - they are so similar in the subterfuge and fakery used. It all makes me feel very helpless at times.

Jack Payne said...

Baird and Warmer, I'm glad you like my lawyer humour, but I think Terry is right. I should have used "class action" lawyer. While all of these are trial lawyers, they, for the most part, are the money grubbing ones. Whereas, there are many trial lawyers who are sqare shooters. Because all elephants are animals it doesn't mean all animals are elephanats. I used too broad a brush when I used the term, "trial lawyers."

Yes, folks, Muse has a simple answer that evidently works, and I'm glad you approve,

Have got to give a lot of credit to your Mom, Kevin. She apparently knew how to handle these clowns. But, it's hard to understand why you haven't been pestered to death by these scamsters. This is one of the most common complaints I get: telephone con men.

Jack Payne said...

"Magnitude" is right, Lynn. When you get up to 10,000,000 cases of identity theft per year, in the U.S. alone, this is overwhelming. Whole societies have been brought down by cogenital failings of this magnitude. I sometimes feel alone in the wild, like Paul Revere riding horseback through the countryside, shouting, "the Con Men are coming, the Con Men are coming."
Sadly, much of my jumping up and down with alarm goes unheeded. But, alas, I keep plugging away. Maybe enough people will start listening yet. Before it's too late.

Terry said...

I don't want to become a self-indulgent, navel-gazing victim, Jack...that's why I keep reading you. Thanks for the explanation on the lawyers.

Warren M said...

I got hit with a odd one last year, a deferred delivery deal, from a mink farm. I had thought that mink had gone out when political correctnes came in. Boy was I surprised

Kevin goodman said...

That is interesting to know. I have been exclusively cell phone the last four years and my business is voip. Perhaps that makes my number a little less randomly accessable. I tell you what - anybody who trys to sell me an investment over the phone whom I don't personally know, trust, and respect (and even then) will get treated like the vacuum sellsman who came to my home last summer.

Jack Payne said...

A mink farm, 'eh, Warren? Hmmm!

Cell phones are cutting the number of these calls, Kevin. Right on.

Sorry I missed you, Nards. MSN is very good at delivering error messages, sometimes better than delivering the actual message.

Dee said...

Jack I wonder how many of your readers are like me. I read your post once and then I always read it again to savor those slick phrases and to get the scams one more time.

Investing in livestock and exotic animals just cracks me up. Who does this crap? Oh well I have seen those ostrich eggs being cooked by Bobby Flay.

One day the scam artist may offer the answer to who came first the chicken or the egg? What kills me is someone may pay for it.

Anonymous said...

These guys have got to be kidding. Just in the past week I have had two different calls offering the same thing - sub-prime mortgages, saying the people were going to be foreclosed and I would make a mint. I hung up on both of them.

Jack Payne said...

Dee, there is no vaccine for gullibility. This is what makes my job so frustrating. And, the need for exposure pops up over and over and over again, as people fall into these same sucker traps over and over and over again.

Yes, Anonymous, the "They're gonna be kicked out" theme is spreading. BTW, why use "Anonymous" for a comment like this? Nothing worth an identity hide-behind here.

BookingAlong said...

This is fascinating, as are so many of your articles. Thanks for dropping by my blog and leaving a comment. You have quite a fan base here!

Larry Rivera said...

Great post its amazing just how many scams go around. Its even more amazing how many people get scammed.

Serendipity Collections said...

Hey Jack,

Thanks for the scam post! I love your last 2 paragraphs of advice!


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