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Scam watch: scammer persuaded me to ‘invest’ £10,000

Coal painted gold

If you’re looking to invest a hefty sum of money, where should you put it? Is investing in Binary Options a good… option? Probably not, especially if the trading company is run by scammers.

Janet Swift from Gloucester said: After my husband lost his job, I was looking to invest some of our pension funds, and found a website selling Binary Options. Its products were professionally presented so I invested £500, and was told I’d receive a call from a trader to discuss my investment options, but never did.

I got back in touch, and was called by a ‘senior trader’ who apologised for the lack of communication. He told me that, although he only dealt with high net-worth clients, he would take on my custom as a goodwill gesture if I invested £10,000.

He convinced me to do so, but despite repeatedly asking where my money was being invested, I got no answer. I then realised it was a scam. I reported the case to the police and to my bank. This prompted the senior trader, who had been using a false name, to get back in touch via Skype. He offered to repay the £10,000 if I cancelled the claim. I’m sure he has no intention of doing so.

Avoid risky investments

We say: Binary Options are an extremely high-risk gamble that we’d warn any investors to stay away from, even with a trusted broker. They are not regulated in any way, so your money is always at risk. And scammers’ tactics often involve encouraging you to throw good money after bad.

Despite providing evidence of your communications with the trader, your bank initially refused to provide an immediate refund, as you willingly handed over the funds. However, our Money Helpline team helped to escalate your claim, and you got your £10,000 back.

Comments
Member

These really are a gamble, not an investment. They are sometimes called ‘all-or-nothing options’. There are far better ways to invest safely and get a decent return.

Always count to ten when thinking of any savings or investment product that has no escape clause.

Never make an investment commitment over the telephone.

Avoid all forms of unregulated investment.

Member

Joe, you say “However, our Money Helpline team helped to escalate your claim, and you got your £10,000 back.”. Was this returned by the scammer or refunded by the bank?

Member

Hi Malcolm.

Our Money Helpline team helped the member dispute the transaction through her bank. It wasn’t willingly returned by the scammer.

Member

Joe, I’m not sure what you mean by “dispute the transaction”. Did the bank retrieve the money from the scammers account and pass it back to the member?

Member
City of London Trading Standards says:
25 August 2015

This doesn’t make sense. The bank have no liability to repay the money. Can you clarify exactly what happened.

Member

Perhaps we gave to interpret “it wasn’t willingly returned by the scammer” as meaning “it was returned by the scammer but reluctantly or under protest”.

Member

Sorry I should have been more clear.

The Money Helpline team helped the Which? member gather evidence to support her chargeback claim.

More info on chargeback at http://www.which.co.uk/consumer-rights/problem/how-do-i-use-chargeback

Member

Joe, thanks. To be clear, the member paid with a debit card and the bank then recovered the money from the merchant’s (i.e. scammer’s) bank – is that the case?

Member

Correct.