This scam is just a simple confidence trick

This scam uses the impression of success and peer-to-peer pressure to con you into handing over your cash.

When I answered my front door, I found a nondescript woman in her late 20s. She was holding some paperwork. She was not smart enough to be selling (or mis-selling) electricity and gas – they all wear sharper clothing.

After a few polite words, she announced that she was about to go on a 5km sponsored walk. By the look of her, fifty metres might have been a stretch but I did not share that thought.

Naturally, I asked more. She told me that she is doing the walk for cancer – I assumed she meant cancer research or relief – and that she had already raised £3,900.

Alarm bells ring

The sum raised my eyebrows. I know plenty of people who have undertaken marathons, triathlons and 50km walks for charity. I have been on sponsored cycle rides – I do one every year for Leukaemia Research. I once managed over £2,500, but that involved a number of companies kindly backing me.

It would be tough raising £390, let alone £3,900 for what is really just a Sunday afternoon stroll in the park.

She was obviously eager not to waste time, and for me to sign her form. So I looked at it. It was a grubby photocopy headed not with a charity, but with NHS. Now I know the state health system has to make cutbacks but it is not in such dire straits that it is forced to do door-to-door sponsorship appeals.

Before I could say no, she said it would speed things up if I gave her the money there and then. She told me that all my neighbours had kindly agreed and had given her £10 or £20.

This was so obviously a scam – she would just keep the money (and the 5kms would be the door-to-door collecting!) - that I sent her on her way. But she would probably try neighbours with the same story.

Confidence tricks

This swindle relied on:

• people being kindly disposed towards charity
• the impression of success – the £3,900
• peer-group pressure – my neighbours had (so she said) already agreed.

It was a confidence trick and, except in the amount, not far different from the Ponzi banking scheme which saw disgraced banker Allen Stanford convicted of fraud last week.

His Panama-based Stanford International Bank had ripped off £5 billion from an estimated 17,000 victims who have little chance of getting more than a few percentage points of their money back.

Aged 62, he was sentenced to 110 years in prison by a US court to ensure he spends the rest of his days behind bars even if he got time off for good behaviour. The prosecutor wanted 230 years, again an absurd number, but one that sends a message.

Like Bernie Madoff, Stanford operated a Ponzi scheme. He offered great returns on deposits and other investments but could only pay out those wanting a withdrawal with new money coming in. In common with all such plans, the fresh cash starts to dry up, everyone suddenly wants their money back and discovers that there is nothing in the kitty.

Like Madoff, Stanford led a high society life. Stanford's passion was cricket and he financed many a team and tournament, especially in the Caribbean, with his ill-gotten gains. He famously helicoptered into Lords with a case full of dollar bills, seeking to sign up English cricket stars for a 20-20 tournament in the West Indies. And infamously, he was pictured with some of the wives of the players sitting on his knee.

Who could believe that someone who both fraternised with, and patronised, the highest officials of a game renowned for fair play could be a crook?

He relied on the public being well disposed to sport, the impression of success, and peer-group pressure as he could list all manner of celebrities who had apparently done business with him. Other than a row of noughts, he was little different in the way he gained confidence from the woman at my door.

More on scams:

And the winner is... the scammer!

How your details end up in the hands of cold callers

Dodgy Thai emails

The Facebook scam

The sick solicitors that prey on the bereaved