Matt Allwright uncovers the secrets of sophisticated scams. Matt meets 23-year-old Steve, who had his dreams shattered by conmen who posed as an HGV training firm.
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Each year, almost half the population of Britain is targeted by some kind of scam
and the brains behind these scams are quick-thinking con men
who know every trick in the book to get you to part with your cash.
Coming up, the scam that targets people who want to train
for a new career.
The hopes of obviously my career in the future of driving HGVs
is slowly starting to vanish.
It's a light at the end of a tunnel, it's miles away now.
And we hear about the bogus share scheme
that went after people's hard-earned savings.
The sort of victims that we were seeing,
they couldn't afford to lose the money.
Well, I'm here to tell you what the con man doesn't want you to know -
how to stay one step ahead of the game and not get scammed.
Here's a question for you to ponder -
what's the difference between a salesman and a scam artist?
OK, time's up.
In most cases, the only difference is
that a scam artist sells a product that doesn't exist.
And when the thing they're pretending to sell
promises someone a career for life, it can be doubly devastating.
I'm on my way to meet 23-year-old Steve
who's recently been the target
of a scam that played on his hopes and dreams.
Steve's been unemployed for the last six months,
but unlike many people his age, he knows exactly what job he wants.
You see, since Steve was a little lad,
he's dreamt of becoming a lorry driver.
Why did you want to be a driver?
It's just something I've always wanted to do since I was a child.
I went with a friend of the family when we were young,
on journeys up north in his truck.
So it's just something where I've played with the idea
and now I'm old enough to get my licence
In late 2010, Steve decided to try and make his dream a reality,
but sadly, that was about to make him a perfect target
for a group of con men.
If you want to become a lorry driver,
you need a HGV licence and they don't come easy.
You need to pass tests, have special training,
and even undergo a medical.
But there are firms of brokers who can arrange all of this for you
for one single fee.
Sadly, though, as industry experts have seen,
a minority of these brokers
have turned out to be nothing more than scam artists.
There are some brokers out there that will just take your money
and not deliver any training - full stop.
And unfortunately, the con men are able to exploit the fact
that almost anyone can set themselves up
as an HGV training company.
A lot of people are not aware
that our industry is not regulated, not regulated at all.
Which makes life a lot easier for the scammer.
But as Steve began searching the internet
to find a HGV training company,
he had no idea he may end up dealing with con men.
First of all, the scams are mainly conducted
where they attract people initially is via their websites,
where they give people the overwhelming impression
that they are both a training company
and a recruitment specialist as well.
But it's sold as a very easy fast-track
to making some serious money.
They take all your details, take the money off you,
arrange the theory test
and arrange the medical and then send you to somebody
who's got a fleet full of vehicles themselves.
You're looking at a one-stop shop?
I was looking to get it done as soon as possible, but also as efficiently as possible.
So they could organise it all for me.
Did you find any recommendations or endorsements from anybody else?
They did say, on the website,
it did have on the bottom a logo for the RHA,
which is the Road Haulage Association.
So I looked at it and I thought,
you know, I've heard of the Road Haulage Association.
Let's talk about the first conversation you had
with the company we're talking about.
He was quite helpful and he wasn't very pushy.
He wasn't like, "Can you make a payment?"
I suppose it put my mind at rest
that I'm speaking to someone who's interested in me as a person
rather than just how I'm going to pay for it.
The fact that he showed an interest in you,
that immediately gets you more engaged than you were previously.
Now, there are several stages to becoming a HGV driver.
First you need to have a medical,
then you need to get a provisional licence and take a theory test.
And finally, you must do a minimum of five days' practical training.
The company Steve had spoken to
said they could arrange all of this, and more.
Everything from him filling out obviously all the forms on my behalf
to booking my theory test, to booking my medical,
to booking my practical lessons.
From start to finish, he would take care of everything.
but what Steve didn't realise was that it was all an illusion,
designed to make him part with his cash.
These brokers, in reality,
they employ no instructors,
they have no training vehicles,
and the jobs that they advertise on their website
are normally taken from other websites
who are agencies, recruitment agencies,
so they are not a recruitment specialist either.
'The salesman had already done enough, though,
'to convince Steve that his company was the one to go for,
'and they began talking money.'
And did they put a price on that at that stage?
Yeah, it was £2,400.
What we've got is someone who is friendly enough, he's clear.
You've got a course which looks like it's the real deal
and a price that's in the right bracket.
-Yeah, that was it, yeah.
Perfectly convincing, yeah.
The company had Steve exactly where they wanted him
and he signed up to their course.
They didn't ask for the full £2,400 upfront,
instead they asked Steve for a £200 deposit
so they could go ahead and arrange his theory test and medical.
Once the DVLA had received the results of Steve's medical,
they sent him his provisional licence.
Steve was now officially on the road to becoming a truck driver.
Initially, Steve had only paid £200
towards the £2,400 cost of his training
and he knew he'd have to start paying off the balance.
But the company seemed happy for him to pay in instalments,
so before he moved on to the theory test stage of his training,
Steve paid a further £500.
Then you're 700 quid in,
-absolutely no reason to think there's anything wrong.
Not at all.
Steve spent the next few weeks revising for his theory test,
but a few days before the exam,
the training company were back on the phone
and they were about to test Steve's faith in them.
The salesman now wanted to know
how Steve was going to pay his outstanding balance
which was over 1,500 quid.
I explained that me mum will borrow me the money.
He then asked for a conversation with my mum.
I thought he wanted to talk through
whether she's going to set up a direct debit
or some sort of payment.
I went upstairs, I passed the phone to my mum,
and I went upstairs and came back down
and she told me that she'd paid it in full.
'Steve felt indebted to his mum, but with the course paid up in full,
'he could now really focus on getting his licence.'
-So your theory test comes?
-The theory test comes.
-You nail it?
-Yeah, I nail it, yeah.
'But the feeling wasn't to last.
'Steve was now waiting for a date
'to start his practical driving training
'and the salesman who he'd started to think of as a mate
'suddenly didn't seem so keen to chat.'
So then I was constantly ringing -
once, two, three, four times a day,
they wouldn't answer.
He'd then answer and explain that,
"I'm not in the office at the moment.
"I'll call you back tomorrow."
Tomorrow would come, I wouldn't have a phone call.
I'd be sitting here, doing nothing.
After another week of fobbing Steve off,
someone else from the company rang
to explain that the salesman he'd been dealing with
had been away from the office for personal reasons.
I said, "Can you arrange it? Can you do it on his behalf?"
At this stage, are you also thinking,
"Hold on, this is not my money that's been spent here"?
How much of an effect does that have on the way you are thinking?
When you borrow money off somebody to pay for something,
obviously, you want to pay them back as soon as possible.
-And it's your mum.
-And it's me mum, yeah.
But Steve was about to find out
that the trust he and his mum had placed in the company
had been cruelly abused.
The new person Steve was dealing with
would no longer answer his phone.
Because the company's office was hundreds of miles away,
Steve couldn't go and knock on their door.
So he went back online to see if he could find any information.
I come across a website with quite a bit of information.
He'd found a forum where others were complaining
that they'd been cheated out of thousands of pounds
by the same company in the same way.
They got as far as their theory test,
but when it was time for practical training,
the company went quiet.
So as you're reading this website
full of comments that match exactly your experience, pretty much,
what's going through your mind?
How am I going to have to go in the house
and tell my mum about this information?
That money you borrowed me, it's gone.
But Steve's fears were slowly being confirmed.
He phoned the Road Haulage Association
who the company had claimed had given them a stamp of approval.
But the RHA had never heard of them,
so Steve reported the firm to Trading Standards and the police.
He now had to come to terms with the fact
that his dream of becoming a lorry driver
was well and truly parked.
Tell me about the five minutes
before you explained to your mum what had happened to her money?
I come in and I remember she was by the back door, washing.
I just joked and said,
"That company, I think it's had me on."
She's like, "What do you mean?"
Putting things in the washing machine. I'm like, "Yeah."
And then it wasn't until I actually showed her the information
where she was like, "OK. Right, where do we go from here?"
It's now up to the authorities to investigate the rogue firm,
but it's extremely unlikely
that Steve and his mum will get any of their money back,
but at least Steve has had the courage
to come forward and share his story,
because many who are caught out by this scam wouldn't.
Can I suggest why it happened?
-Because you really wanted something,
someone offered it to you,
they made it look like you were going to get it,
they conned you by getting to your mum,
and then the thing that they were offering didn't exist.
-That's how they did it.
-In a nutshell.
If you want to be a lorry driver,
how can you protect yourself against the scam artists
and dodgy brokers who'll leave you stranded on the hard shoulder?
The first thing is,
be aware of companies who claim
that they have 25, 30, 40 training centres around the UK.
The simple fact of the matter is
there are no national HGV training companies.
If you can, try and see the company or training centre for yourself.
Visit the training company. Don't part with any money over the phone.
If it sounds too good to be true, it normally is.
And our best piece of advice is
if you are serious about a career as a truck driver,
then go direct to a reputable, established training company
in your area.
And there are plenty of them around.
It's just a case of doing your research
and speaking to independent organisations who can offer advice.
Sadly, all of this is too late for Steve.
They've sold me an idea that I've obviously took
and I thought, "Yeah!" and that's how they've got me.
For most people,
making investments isn't about trying to turn a fast buck.
It's about making the most of your hard-earned savings
so you can plan for the future.
And of course, one of the oldest and best-known forms of investment
is in the stock market.
Here's the good news.
You don't have to be a stockbroker to buy shares.
You can balance risk and reward for your own profit.
On a slightly less optimistic note,
you can also find out later that your shares don't actually exist.
And in 2007, a group of ordinary, hard-working people were contacted
by a reputable-sounding firm of stockbrokers.
and offered a golden opportunity to boost their savings.
They were being given the rare chance
to buy shares in a company that hadn't yet come to market.
It was an investment into a fantastic company called EduVest
which was supposedly a company investing in education.
People were told that if they invested in EduVest PLC,
they could make their money back three or four times over.
One of the people who went ahead and bought shares is Alan.
Alan isn't his real name,
but because he's concerned about repercussions
he's asked us to conceal his identity.
Like thousands of people in the UK, Alan wanted to invest in the stock market
so he could look forward to a comfortable retirement.
I'd planned on retiring when I was 55
and so, to do that, I needed to have something substantial
to back me up until I got to my pension age.
And from what Alan had been told, investing in EduVest PLC
would help him boost his retirement savings no end.
But what he and other investors didn't know,
is that EduVest PLC was a scam.
Share-related scams have been going on for decades
and are often known as boiler-room frauds
because they were run from dingy utility rooms
in the basements of office blocks.
Boiler-room fraud is something that's been around,
I'm sorry to say, for as long as the stock markets have been around.
And wherever there's an opportunity to scam money out of people,
I think it will always exist.
The basic principle is always the same -
to sell shares that are either worthless or non-existent.
It's something the FSA, the Financial Services Authority,
are working hard to stamp out,
and Jonathan Phelan is their head of retail enforcement.
I run the unauthorised business department
and our job is to look at 5,000 or so reports that we get every year
of unauthorised business
and we see which ones are causing most harm to society
and we try and tackle those.
And the FSA team would soon be tackling EduVest PLC,
but not before the company had scammed innocent investors.
For Alan, who'd invested in shares before,
it all began with a cold call from a stockbroker called Ben
who said he worked for a blue-chip investment firm
in London's financial district.
The absolutely crucial sign is that you will get a cold call,
a call out of the blue.
You won't have invited it.
If you challenge them,
they might try and convince you that you did invite it
by ticking a form on a page or on a website,
but the reality is you didn't really want that call.
In a classic boiler-room tactic,
Ben slowly built up Alan's trust
by ringing every week or so, usually just for a chat.
He'd ring up and he'd be on the phone for 20 minutes
or half an hour sometimes,
just general conversation.
"How are you going on?
"What have you been doing this week?"
They will try to get an idea of what sort of investor you are.
We did talk about different stocks and shares.
He asked me about my portfolio, what I'd got in where.
Once they've manoeuvred you where they want you to be,
that's when they'll try to extract the money out of you.
And in Alan's case, that began when, one day,
Ben told him about a fantastic opportunity
involving a brand new company, EduVest PLC,
and Alan was told it was an investment firm
specialising in education.
Ben suggested that Alan look at the EduVest website
and he went on to explain that buying shares in the fledgling company
was an opportunity to make serious money.
He said when it came to market it should take off
and I could treble my investment.
Alan was impressed by what he saw, but more than anything,
it was his relationship with Ben that really sealed the deal.
I trusted him. You see, he wasn't with EduVest.
He was like an adviser.
The con men had Alan right where they wanted him
and they began to talk money.
Well, I said I'd be interested to have a bit of a punt on them.
I said about 2,000 shares.
In a moment he would soon come to regret,
Alan found himself writing out a cheque for £2,000.
And three weeks later, doubts began to set in.
Alan had been promised paperwork to confirm the shares were his,
but nothing had arrived.
So he got on the phone to Ben.
He said, "You should have received some sort of acknowledgement.
"I'll get on to them." And about a week or so after that,
I received a letter thanking me for my investment in their company
and when it came to market in June,
that's when the share certificates would be posted off.
But June came and went and Alan heard nothing more.
So he got back on the phone to Ben,
the broker he thought he could trust.
I was getting no reply. And then bells started ringing.
Alan couldn't get hold of Ben or anyone to do with EduVest,
and he was now beginning to wonder where his £2,000 had gone.
It looked like I'd just chucked £2,000 away.
But Alan wasn't going to take it lying down,
and he decided to get in touch with the FSA.
When I spoke to the FSA
and they said there was nothing down about the company,
that's when I realised that...
I'd been conned.
He'd been told it was an investment into a fantastic company called EduVest,
which was supposedly a company investing in education.
Actually it didn't really operate a real business.
With a serious complaint to investigate,
Jonathan and his team's first task was to get the full story from Alan.
The FSA got in touch with me
and asked for a statement about what had gone off.
And I filled in a statement
and then they came up and interviewed me.
The most crucial piece of information
Alan was able to give the FSA investigators
was the name of the bank account into which he'd paid his money.
The account was UK based, which meant Jonathan and his team had the authority to access it
and when they did, the shocking scale of the scam was revealed.
We were able to look into the bank account
and find one account concerning EduVest
that didn't just contain the first victim who had called us,
it didn't just contain HIS money, but it contained £270,000.
The 270,000 had been paid in by 32 innocent investors
just like Alan.
And that led us to look at where that money had gone
and we found that it led to an individual called Mason.
The FSA now had a prime suspect.
A 29-year-old ex-sales adviser called David Mason.
And it was time to pay him a little visit.
The powers we then had were to execute search warrants
at various properties.
With the evidence they seized,
Jonathan and his team uncovered some of the devious tactics Mason used
to con 32 people out of their savings.
Mason set up a client relations manager who didn't actually even exist,
but this fake client relations manager wrote to the customers
and said, "Thank you for investing in EduVest,
"we will send you reports from time to time."
This was part of Mason's plan to convince people that EduVest PLC
was a serious company that they should buy shares in.
What EduVest really was, was a shell company
and that means what it says on the tin, as it were.
A shell company doesn't have anything within it.
It didn't really do anything. It was just a vehicle for a fraud.
Mason had also managed to rope in an unsuspecting financial adviser
who worked for a legitimate FSA-registered company.
The adviser provided Mason with a client bank account,
which Mason then used for EduVest PLC.
This helped convince investors they were paying money
to a legitimate UK business.
If you can give them a UK bank account of a known firm that you can look up on
the FSA register or look up on a website, then you might feel
a little more comfortable that you are paying your money
at least to a UK company.
All Mason needed now was a sales team
to flog his non-existent shares,
and that's where the boiler rooms came in.
Mason set up six boiler rooms
and they were all abroad, to try to avoid UK law.
Those six boiler rooms based abroad
had their list of potential victims that they could call.
Using the script that Mason set up for them about EduVest,
they would start selling shares in EduVest.
Alan spent months dealing with a so-called stockbroker called Ben
who worked in one of the boiler rooms,
but it never occurred to him that Ben might be overseas.
I sort of envisaged him working in this office in the City of London
and he was quite believable.
Mason had everything in place to pull off his scam
and it was only a matter of time
before 32 innocent investors were drawn in.
The victims we were seeing, they couldn't afford to lose the money.
They were elderly, in the majority.
We even found one who, having died, his widow had been approached
by the boiler room, knowing that her husband had died
and they still tried to scam her out of money.
As long as the money kept rolling in, Mason didn't seem to care.
With statements from the unlucky investors,
a trail of bank statements and a series of e-mails,
the FSA had gathered overwhelming evidence against Mason
and in June 2011, their efforts paid off.
The outcome of the case was a successful conviction.
Mason pleaded guilty to 13 offences
relating to setting up or assisting with the setting up
of a boiler room, plus additional charges relating to money laundering
and making false and misleading statements.
Mason was sentenced to two years inside,
which was a great result for Jonathan and his team
and the FSA's first-ever criminal conviction.
For investors like Alan, justice had been done,
but there was even better news just around the corner.
I got a phone call from one of the FSA guys and he said,
"I've got some good news for you."
He told me I would be getting my investment back
because they had confiscated it. It was in the bank.
So I just breathed a sigh of relief that I wasn't £2,000 out of pocket.
For further advice on how to protect yourself against scams, go to:
Before we go, there's just time to tell you
about some of the latest scams out there,
and I'm meeting an expert at the National Fraud Authority
to get the low-down on what you should be looking out for.
Today, we're looking at scams
targeting people who want their 15 minutes of fame.
These can range from those who want to set up
as a false modelling agency,
a false agency for singing, for acting and for dancing,
and they are all promised that you are the person they are looking for
and that others are looking for.
We can take the photographs of you, take the video, charge you a couple
of hundred quid, but it's worth it, because we'll make you a star.
Really, the damage is done to the kids' confidence,
once they find out it was all a bag of lies.
Genuine talent agencies earn commission on the work
they get for you, so if you have really got what it takes,
they shouldn't be asking you for money upfront.
Next up, a scam that targets a different type of fame hunter.
Everyone's meant to have a book in them,
so they will put adverts in or send things on the website
and e-mails saying they can publish your work.
You send off your manuscript, they say it's great,
they're sure they can print it,
but they need some fees upfront to make this happen.
It's called vanity publishing businesses,
these scam companies. They take your money,
they've probably thrown your manuscript in the bin.
If you're really serious about selling your novel,
do some research to find the right publisher for you
and then do background checks to make sure they are a bona fide firm.
There you go.
It doesn't matter how clever the scam is, if you recognise
the warning signs, you can stay one step ahead of the con men.
Stay safe. See you next time.
Subtitles by Red Bee Media Ltd
Matt meets 23-year-old Steve, who has wanted to be a lorry driver since he was a boy. But Steve had his dreams shattered by conmen who posed as an HGV training firm so they could get at his cash.
Plus, how the Financial Services Authority secured their first ever criminal conviction against a man who set up a bogus firm to scam innocent investors, and the scams that target people who want their fifteen minutes of fame.