Here’s how it works. When you’re on the beach, you’ll be offered scratch cards. They’re a euro or two, that’s all. But you could win a big prize. And guess what, you’ve gone and won a big one! All you’ve got to do is go along to a free holiday presentation to collect it.
Holidaymakers do. Heck, why not? It’s only a morning and it’s a real big prize! The
presentation’s slick and impressive and you’re offered the chance to join an exclusive holiday club offering exciting, value-for-money holidays all over the world. Only the very best accommodation and at really low prices – after all, you’re in the club.
And people sign up! Problem is you could get the same holidays at the same prices
online and even at your local travel agency. Even worse, by the time you get home, that holiday club has disappeared.
The OFT’s Advice
The OFT warns consumers about what happens. They’re saying that 400,000 UK consumers fall victim to these clubs at a cost of over £1 billion each and every year.
400,000! That’s a city the size of Bristol. This is a big scam and lots of ordinary people are being conned. The con-artists say that the special discounted offer is only valid for that day, encouraging people to sign up or miss out.
These scam-artists just won’t let you go. You’re never left alone to discuss anything
with your partner. And you are given a very limited time to view the contract!
The Bottom Line
The OFT says that if you go along to a presentation you should ask three simple questions. Do you give cooling off rights? Is everything you promised in the presentation in the contract? Can I take away the contract to consider at my leisure?
If the answer to any of these questions is no, walk away. That’s sometimes easier
said than done. Some presentations last so long that some people sign up just to get away.
The best advice is simple – don’t even buy the scratch card in the first place! Have a great holiday. Get a tan. Have a nice swim. Go and see the sights. And don’t get conned by this scam.
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BE WARNED - Landbanking scams, where unsuspecting investors are persuaded to
buy agricultural land at vastly inflated prices, are on the increase.
That was the warning this week from the government's Insolvency Service, which revealed that the amount lost by UK investors since 2007 alone totals more than £30m. These are 'known losses' relating to 49 firms shut down in the past four years – it is estimated that total losses from all landbanking scams exceed £200m.
The research also reveals that the average amount invested and lost by the victim of a landbanking scam is around £23,000. However, it is thought the biggest sum allegedly lost in the UK by one person or family is £618,000.
Investors cannot make any claim against the Financial Services Compensation
Scheme because the firms behind the landbanking are not authorised by the
Financial Services Authority.
Landbanking companies typically buy up agricultural or other land without
residential planning permission, then divide it into small segments and sell these to investors. Purchasers are led to expect that their bit of farmland will get the go-ahead for housing development, which would see it soar in value.
These firms often employ hard-sell tactics to persuade people to buy. Many of those targeted are older people with a lump sum or an inheritance to invest, who may be pulled in by the spiel suggesting that, at a time of low savings rates, this is a high-yield investment with a relatively quick turnaround time. However, the plots being marketed are often green-belt land or sites of special scientific interest, which are not likely to get planning permission. Some of the firms use forged documents carrying a Land Registry stamp as an "official guarantee" that their plots already have, or will gain, permission for homes.
The Insolvency Service said that since 2009 it had seen a 33% surge in the number of complaints received about landbanking schemes, adding that it had noticed
"an increasing amount of activity in this area".
An analysis of a sample of 35 landbanking victims from four scams closed down
since mid-2009 shows that almost half (44%) were over 60. The oldest investor
was 85. It seems that men are more likely than women to be targeted.
Officials said some of those ripped off are people you might think would know
better and would be less vulnerable to such scams. Victims can just as easily be
professional people and wealthy investors from overseas. However, the Insolvency
Service has found it difficult to find people who are prepared to go on the
record and speak publicly about what has happened to them, perhaps because they
are worried about the harm it may do to their reputation.
For more information go to the Insolvency Service website.
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