The pensioner who lost thousands to cold-calling scammers

Scammers targetted this old lady with wine scams, carbon credit scams and even coloured diamond scams, making off with thousands of pounds.

No one should ever engage cold-calling investment salesmen (invariably male) in a dialogue. Just slam the phone down hard as soon as you hear the boiler room's background buzz. Otherwise, they will catch you, play you, rip you off for as much as they can – and then try over and over again to squeeze you for more.

If you don't believe me, then read about Mrs SJ and her 13 year ordeal at the hands of fraudsters. Despite her long, expensive financial abuse, the authorities have done nothing to protect a vulnerable elderly woman. Her son, who asked for anonymity for the family, sent me her case notes.

Targetting the elderly

She was first approached in June 2000 when she was 72 by Goldman Williams, a fly by night firm which sold her six half cases of wine over the following 18 months. What exactly she was sold is unclear due to a large number of handwritten corrections on her documentation. Goldman (no relation to Goldman Sachs) worked out of a “suite” in a “business centre” - an address which would have caused my alarm bells to ring.

Her last purchases were some £4,000 of wine on 27 November 2001. Two days later, the official receiver was appointed in the public interests to Goldman Williams and associated firm City Vintners in order to wind them up. In all, she spent £8,208.

Two of the six cases were real and were later discovered in a bonded warehouse. They were worth around £3,900 but she had to pay regular storage fees.

Once bitten, twice shy?

It should have been a case of once bitten, twice shy. But that's not how it works. Phone fraudsters know that someone who has fallen for their story will be susceptible to a repeat version. So Mrs SJ was “re-activated” in November 2007 by a firm in Malaga, Spain. The paperwork was meaningless but the money – another £3,500 – was real. This firm changed addresses several times and then disappeared.

Fast forward to September 2012 when the Goldman Williams liquidators sent her an update. Needless to say there was no joy here. But this legitimate letter served as a prompt for someone to call her. Remember, this is an elderly woman living alone.

The caller got her to transfer ownership of the remaining wine in bond to another company, again operating out of a mailbox address. This new concern persuaded her to hand over what seemed to be her wine holding – now apparently worth £4,900 (assuming the wine was genuine), compared with an original spend of nearly £12,000 – in return for carbon credits.

So she exchanged an item of some value for worthless paper in a scheme which is, according to regulators, doomed to failure. This led to a second carbon credit merchant, who informed her the wine was worth £5,400 but – as a goodwill gesture – offered a swap into carbon credits apparently worth £7,650 via an “asset exchange”.

It gets worse. Either the wine did not exist or the first “recovery” company stole it, but the second carbon company billed her for the full £7,650. It seems likely that these two companies are acting together to get as much as they can. According to her son, who has power of attorney for his mother, Mrs SJ, who suffers from some memory loss, cannot recall any of this.

From wine to carbon credits to coloured diamonds

The second company then sold her a coloured diamond for £25,000. The coloured diamond market, as readers know, is largely a nonsense. Read The coloured diamonds scam.

In her confusion, she sent three cheques - £25,000, £25,000 and £10,000 – all of which bounced. But the coloured diamond/carbon credit company had no intention of giving up, despite pleas from the son.

The dodgy diamond company's phone number is now permanently “out of order” although the son tracked down an ex-director who turned out to be a 21 year old who begged “don't tell my mum and dad about this job”.

The diamond firm's website seems now to be closed. But the guy behind it is already in negotiations to come up with a new one.

Meanwhile, the son contacted the police and trading standards. However, he warns: “It is very frustrating to find out how limited and passive the authorities appear to be in this area of fraud. It would seem on the face of it that, with just a little bit of wit, they could easily get ahead of the game and try to anticipate some of it.

"The internet is making it easy for the fraudsters but, equally, it could also easily be used against them; for example, internet searches on known serviced office addresses and carbon credit/diamond trading etc. I have just tried this for interest sake and several dodgy sites appear immediately. Until I became involved on behalf of my mother, I would never have believed how people carrying out this kind of fraud appear to be able to act with almost complete impunity.”

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