Don’t Give What Money You Have to Scammers

The October/November 2012 AARP magazine has an article entitled Confessions of a Con Artist. The man quoted in the article ran scams for years, was finally caught, served jail time, is now living with his parents, has no hope of paying the government the money he owes and is now willing to share how he made so much money on his victims.

Financial times are tough for most everyone right now. I wrote a book and keep up this blog to give hints on how to stretch the money you do have, but losing money to a thief or a scammer is the ultimate insult. You may not be able to prevent job loss or home foreclosure, but you can keep yourself from becoming the victim of a scam.Image

Here are some of the hints from this former con artist who worked in thirty fraudulent business operations over a ten year period.

Scammers Appeal to Your Emotions, Not Logic

This man was known as a closer – the one who gets someone to hand over their money. His victims were not stupid. They were doctors, lawyers, engineers and college professors, in short, people who had money to lose. The logical response to all of his appeals should have been, “I don’t know you. I’m not going to send you any of my hard earned money.” He overcame their reluctance by asking personal questions and using two driving forces in hard times – need and greed. He was able to convince his victims that what he was offering would be a fix to their problems.

Interestingly, he said that when he was working bogus oil and gas deals, business opportunities and gold-coin scams, the perfect victim was always a male, often a senior citizen who was not afraid to share his fears about the unstable financial market and living on a fixed income.

Be aware of these precautions:

  • Never make a decision until you have taken at least 24 hours to think about it.

Time gives you a chance for the emotional effects of the sales pitch to subside and allow you to do research. Although some senior citizens are not schooled themselves on how to do adequate research, most everyone knows someone who is.

  • Never share personal information about family or your concerns with someone trying to sell you something.
  • Ask yourself, “what’s in it for the salesman?” If they are offering such a great deal, why aren’t they doing it themselves?
  • Beware of statements like this one, “You and I are going to make a lot of money together.”
  • If this man was still in the scam business, he would focus on reverse mortgages and precious metals. These are his reasons why:

A lot of seniors have paid off their mortgage and the idea that they can get money out of their house while they are still living in it is attractive. Some reverse mortgage ads are legitimate; many are not. He states that even those that have famous spokesmen may not be legitimate as the celebrity’s only job is to read his part and leave. His contract may state that he cannot be held responsible for the accuracy of the claims in the ad. In short, he may know nothing about the business.

Never sign any paperwork on your house until an attorney you choose reads the fine print.

He sold gold and silver coins at a 300-500% markup. Victims were unaware that the value of their coins was significantly less until they tried to sell their coins – years later.

How unfortunate it is that protecting yourself against fraud and theft is necessary, but it is. In this case, these warnings can help prevent that from happening to you.

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