Top ten scams in 2011

Tony Levene runs down the top scams of last year

The Christmas pantomime is now behind us. To be truthful, however, the assemblage of C-list celebs playing in theatres which time has forgotten has long failed to persuade me to bring out the plastic and buy tickets.  

It has been a very long time since I last saw one of these shows. It might have been Aladdin although I am not sure – certainly the venue is now an office block or shopping mall. But my enduring memory is of making rude noises at the villain and cheering the hero/heroine. 

Whether it's the pantomime – or any other form of theatre – you have to suspend your disbelief to enjoy the show. We shudder at Macbeth, we laugh at Twelfth Night. We root for Aladdin and wish nothing good for the Evil Genie. 

That's showbiz. But the one unifying feature of all the frauds and scams that feature weekly in this column is that victims have to suspend disbelief. The theatre is a fraud – what you see and what you believe is not for real although great actors can make you think it is actually happening. 

Fraudsters have to be great actors – they must get into targets'  minds, take them over and convince them that black is white and day is night. How else do they make their money? Looked at in the cold light of day, their schemes are absurd.  Rudimentary checking throws up plenty of reasons to slam them out of your life – in depth research shows up just how ridiculous their schemes are.

They are the villians, real villians who produce financial misery and personal heartache.  And they have the money to produce fancy brochures, clever websites and hire expensive lawyers. 

Who then are the heroes and heroines? It's not just the authorities such as the police or financial regulators.  It's also the readers of this blog. Not only do lovemoney.com readers fall for the multitude of scams I uncover each year, they are in a position to warn others – especially vulnerable and trusting people such as the elderly. 

Here's my list of the year's top scams – those that are becoming more prevalent are followed by hisses and boos while those where the racketers are being forced back are indicated by cheers. But remember fraudsters are flexible – as one door shuts, they'll be there with another wonderful scheme that will make them a fortune and strip your bank balance.  And these ideas never go away – they'll be back one day. 

1. Boiler Rooms in Spain – there's a lot less of high pressure outfits selling non-existent shares thanks to a combination of the Spanish police, and UK authorities including the FSA which have cracked down on dishonest lawyers approving their adverts “for marketing purposes”. Hooray.

2. Phoney bonds - this is a new trend. Take a top company name, and tell potential victims it will pay 10% fixed income a year for five to ten years. Total rubbish but people fall for it. Boo.

3. Nigerian 419 letters - widows promising a share of some dead dictator's ill- gotten gains seem to have almost disappeared this year. Hooray. But with so many new dead or disposed dictators, this scam is ripe to reappear. Boo.

4. Russian brides - maybe I'm not seen as a good prospect, but the number of scams involving pretend east European women looking for husbands (more accurately, scamsters looking for bank accounts) is apparently down this year. Hooray.

5. Money generation schemes -  there's been a big surge in emails promising automatic cash each day for no effort if you go to a website and sign up. If you respond, expect to be pestered for months.  And if you join, watch your bank balance sink. Boo.

6. Pretend lotteries -  remember those letters that told you that you had won millions of euros in a lottery you had never heard of, let alone entered?  The only snag was sending £10,000 in “legal fees” to get your money.  I've not seen one all year.  Hooray.

7. Phoney fortune tellers -  people promising to give you winning lottery numbers while protecting your health from evil are proliferating, targeting the vulnerable. While each loss is relatively low, once you sign up, you are bombarded with scores of similar scams. Boo.

8. Non-existent charities - OK, I need never buy a bin liner thanks to a constant supply of plastic bags through my door seeking my surplus clothes. The text sounds like a charity but “providing work in Latvia” or “helping children in Russia” or “preventing breast cancer in West Africa” does not count.  Boo.

9. Landbanking – this might finally be on the decline. It's been quite a few months now since I was last called with the promise that some slice of land would soon be worth a fortune. Hooray.

10. Carbon trading – the home for redundant landbankers and the super scam of the year. Remember that those “voluntary credits” they say will be worth £10 cost them 10p and are unsellable. Boo.