Are Timeshare Scams Called "Advanced Fee Frauds"?
September 25, 2012
The following article describes Advance Fee Frauds in the securities industry. These schemes are prevalent in the timeshare industry too. Please consider:
Boiler rooms and advanced fee fraud schemes are usually managed by very large international crime syndicates. When a boiler room closes, the victims’ contact and investment details are distributed to other members of the crime syndicate for further fraud attempts. They reason that if a victim lost money once, he is susceptible to losing more money again.
A single crime syndicate may only take a few years to defraud 100,000 victims of several billion dollars. Total losses for the last 25 years are estimated at $300 billion. Some “reputable” banks and securities brokers secretly participate in the fraud, instead of reporting it to money laundering authorities as they are required. The closing of any particular boiler room, even by police, does not stop the crime syndicate – they can open 10 more if they wanted to. In this way, such crime continues on to the present time.
In advanced fee fraud, the fraudsters typically promise a high price for the worthless shares. When the victim appears interested, he is told he will have to pay an advanced fee for some invented reason, e.g. to remove non-existent restrictions or for some other fiction.
Advanced fee fraud flourishes because it is rarely prosecuted - the fraudsters feel safe! They take advantage of trusting people. The fraudsters may give fake addresses which have nothing there or perhaps only a secretary who redirects phone calls and letters, but knows little or nothing about the real business. The fraudsters are rarely at the address they advertise, and they often use phone lines which are redirected to another address e.g. in another country.
The fraudsters are completely ruthless and will take the last dollar of life savings from old people. Read this account for more details: Lifting the lid on 'boiler room' scams. London Police operateone of the few intelligence centres on Boiler Rooms.
Many official warning lists suffer from the weakness that it is generally too late by the time the warning is published, even if a potential victim knows where to check. The warning list published below is the most up-to-date that we are aware of regarding fraud attempts against our clients. We cannot guarantee or prove that all names on this list are fraudsters - generally that is only confirmed when it is too late and they have disappeared. Attempts to find these people at their advertised addresses generally fail. However, we strongly recommend you do not deal with any of these firms without consulting us first.
The article that appears above is was copied and pasted from a web page that is no longer available.
Our takeaway from this article is there is a practice of cold calling individuals we all need to understand and be aware of:
- We receive a cold call.
- The caller knows our name.
- The caller verifies ownership by asking a leading question.
- The caller states he or she has a buyer.
- The price the buyer is willing to pay is generous.
- The caller needs more information and proceeds to "phish" for....
- Your contract number.
- Your full name as it appears on the contract.
- The exact unit you own.
- Your email address.
- Other personal information.
- The caller offers to send you a contract.
- The caller says "guarantee" and "no up front fees".
- In the end, there is a requirement for the seller to pay fees...
- The seller paid fees do not come from the proceeds of sale.
- The seller paid fees are not held in escrow.
- The seller must show title is clear by paying these fees to another party.