In this months's Connect magazine, Advocate Olaf Blakeley is offering advice on the steps one can take to avoid being fooled by fraudsters.
"Recently, I conducted a jury trial in which I was representing a client charged with fraud. At the end of the trial, by unanimous verdict, the jury acquitted my client.
"During the trial a large amount of evidence was heard in respect of another defendant who had been convicted of numerous frauds. That evidence included hearing from many of the victims who had been defrauded and accordingly, the jury heard some extremely upsetting stories caused by the stress and pressures born from the frauds upon them.
"What became clear was all the victims had totally trusted the fraudster. They trusted him implicitly as did the fraudster’s work colleagues. As I heard the stories unfold I became so very sorry for the many victims. They had lost large amounts of money and in some cases their lives had been turned upside down. I thought it may be a good idea to provide some simple advice to anyone investing money which if followed, may reduce the number of victims of fraud in the future.
"So, the first rule – an old rule – should be this: if it sounds too good to be true it probably is. This is a self-check. Think about what is being offered. Are you being promised high rates of return? Are they much higher than ‘normal’ investments?
"If it’s suggested it’s best to leave lawyers out of it because “they just add to the expense” then say no. Consulting with a lawyer will cost you money that much is true, but it’s a small price to pay for peace of mind. Such a suggestion should cause alarm bells to ring and you should not proceed until you have taken legal advice.
"In some cases even respectable people from big reputable firms can be up to no good. Don’t fall into a false sense of security just because the person has the backing of an upright and decent company. Fraudsters can operate their confidence tricks not just on clients and the public, but also their business partners. This is exactly what occurred in the case in which I was involved.
"The first question is whether the person selling to you is doing so through the firm in which s/he operates or if this is a ‘side deal.’ If the latter, proceed with the greatest degree of caution. If it is the former there are two safeguards: first, ask to speak to another partner of the company, or another senior officer about the investment. It’s less likely more than one person is running rogue. Then, ask details about the company’s insurance policies. Is the firm covered by insurance should an officer within it be fraudulent? Ask for full details.
"Insist on bags of documentation. You need to understand exactly what is being proposed. Look over that documentation and possibly do some ‘google’ searches about the information. Can you find anything on the internet which either gives you comfort or which sends you running scared? If you do opt for the investment, then going forward, make sure you receive regular updates in documentary form. Do not rely on accounts and statements prepared by the person; insist on bank statements or proper accounting information. Fraudsters often present false documentation, which they hope their victims will accept.
"Finally, do not execute anything in a hurry. If you are told the offer is only open for a short time and it’s essential you act immediately, or you won’t be able to grab the deal, politely decline.
"Also, do not fall into the trap that you have known the person for years and everything in the past has been rosy and honest. Some fraudsters are honest to start, but then take the wrong turning or path (for multiple reasons) and change. Just because someone has been a trusted 'friend’ does not mean they will always remain so: Octobers are all about trees revealing colours they’ve hidden all year; people have an October as well.
"I am not saying the above advice is bullet proof and will avoid you making a mistake but it goes some way. Most fraudsters prey upon the trusting person, the person who may be a bit embarrassed to ask difficult questions because it appears you don’t trust them. Good. Don’t. Any honest person who is offering something which is genuine, and is telling you the truth, won’t mind one jot that you want to check things."
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