Matt Allwright uncovers the secrets of sophisticated scams. Matt meets Karla and hears how she was drawn into an employment scam that played on her desire to work.
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Con men, fraudsters, scam artists, call them what you want,
the fact is they're after our money
and last year they took an estimated £3.5 billion off the British public.
how looking for work could put you at the mercy of the con men...
When you look back and think about it, it's obvious that it's a scam.
I was just too pleased to have a job to realise it at the time.
..and the million pound scam
that targeted people selling their car...
I was ringing this phone number and it just rang and rang and rang
and I got no joy, so I started thinking, "Is this right?"
I'm here to tell you what the con men don't want you to know -
how to stay ahead of the game and not get scammed.
Most of us need a job.
It's no surprise, therefore, that there's a range of scams
which are based around employment.
They target people who want to work.
In other words, people who are trying to do the decent thing
and provide for their families.
The sort of people who really can't afford to lose money to a scam.
So with hundreds of thousands out looking for work,
employment scams are a serious concern
to organisations like the National Fraud Authority.
The fraudster is playing on the fact
that you've been out of work for a time,
you're desperate to get a job,
you want to work, you need to pay the bills.
There are a variety of employment scams
and some of the jobs on offer sound quite attractive,
as young mum Kara has found out to her cost.
She lives just outside London with her three-year-old son Toby.
Sadly, looking for work has brought Kara into contact
with some devious con men.
-Hello, Kara. I'm Matt. How are you doing?
Kara, what's your situation right now?
I'm a single parent.
I have got a little three-year-old boy.
I'm on benefits, although I would really like to work.
Since Toby was born, Kara's had to survive on income support.
As well as finding it hard to make ends meet,
she misses the independence of having her own job.
Kara decided to start looking for work in November 2010
and she had no idea that she would end up on the radar of the scammer.
The first stage obviously is recruitment.
The fraudster has to recruit you.
They can advertise in legitimate publications
or they can advertise in job centres.
Where do you go looking for jobs at the moment?
I always look on Directgov, which is the link to the Jobcentre website.
I always really only stuck to that and the local paper.
The Jobcentre section of the Directgov website
features thousands of adverts for work,
and in March 2011, a job appeared there which caught Kara's eye.
It was for an online auction assistant working on eBay.
And I used to be obsessed with eBay, I would buy and sell on it,
so I thought, "This is really good."
The company offering the job said they were an electrical retailer
and wanted someone to sell items for them on the internet
using the auction website eBay.
It was perfect for single mum Kara
because it was work she could do from home.
You saw the advert,
-you got in your application.
An out-of-office reply came back
saying they'd received so many applications.
It sounded as if the job was oversubscribed
and Kara thought she'd missed the boat,
but there was one glimmer of hope.
They sent a form asking more about the feedback you had on eBay.
What Kara didn't know was that this was all part of a clever process
to convince her she was applying for a normal job.
It was pretty much the same as every other application
apart from the questions regarding eBay -
"What's your feedback? How have you used eBay before?
"What type of things have you sold on eBay?"
Kara felt she was well qualified for the position,
but having applied for numerous jobs
and heard nothing back, she didn't want to get her hopes up.
But two days later, the company called to offer her the job.
-How did that feel?
-I was over the moon. I was absolutely over the moon.
What she didn't know
was that she was now in the clutches of the con man.
You've just got a job. You want to work.
You've got to get that money in
and you're not going to question what they ask you to do.
What was it you were doing?
Just listing their products on eBay and answering questions buyers have,
taking the money from the buyers and then sending it to the company.
So you are a middle person?
-You never see the products?
Did you get any contract or did you get anything that said,
"These are your terms and conditions of employment."
I received one e-mail
saying what the money would be, 10% commission,
and what the hourly rate would be,
but it was on a week's trial.
She said, "We'll receive all the information after that week."
The trial period gave the con men a window
in which to carry out their scam
and in another clever move, they told Kara that during this trial,
she would need to use her own personal eBay account.
Although warning signs were starting to appear,
Kara had no reason to question what she was being told.
I was just too pleased to have a job
and the only person that did say something was my stepdad.
-What did he say to you?
-He said, "This sounds too good.
"This is definitely a scam."
I said, "No, it's not because it's advertised on Directgov,
"it can't be a scam."
-And you've ignored him?
What happened next? You've got to start doing your job.
Yeah. I said to her on the Friday I can start today
and she said, "I'll send you over some listings
"put them on eBay, and then e-mail me back with the listing numbers."
Kara was asked to sell a variety of items
including hands-free mobile phone kits for about 100 quid.
She got back to me on the Saturday and said, "That's all great,"
and she asked me every day to give her feedback
on how many people were watching the product,
has anyone bid on it and has anyone won it?
Over the next few days,
Kara was suddenly bombarded with calls from the company.
Every time my phone rung, it was her saying, "How they doing?"
At one point I said, "I thought I only had to give you a daily update."
She just said, "I'm just checking everything's all right.
And then on the Tuesday, I think it was, um,
five of the products had sold.
She said, "If you can now transfer the money into our bank account."
Kara collected a total of £400 from her customers
and transferred this money straightaway to the company.
All she had to do now was to wait for them to confirm
they posted the hands-free kits to her buyers.
You think the goods have been dispatched.
The dispatchers will give you an invoice number.
She promised me she would give me the tracking numbers
to give to the buyers, and suddenly,
when I gave them the money, then no contact at all.
Kara tried calling, but the company didn't answer their phone
and the penny was slowly starting to drop.
With a lot of these scams, there's a tipping point for people
when they suddenly realise
and they understand what's going on,
-or most of what is going on.
-When was that moment for you?
It was probably when she sent me that e-mail and I said,
"No, I'm not having anything until I get the tracking numbers."
When I got no response to that,
I thought, "God, you're so stupid, this is a scam."
OK, what happened after that, then? You said no to her.
I was ringing her every ten minutes.
I know that sounds excessive, but I had the buyers on my back saying,
"I'm going to go to the police about you.
"I want my money back." I was getting threats from them.
And I just thought,
"There's nothing I can do apart from just constantly ring."
The company refused to answer Kara's calls or e-mails
and she now realised she had to face the music from the innocent buyers
she'd unwittingly drawn into the scam.
There are two victims here -
there's you that hasn't got the job that you thought you had
and also the innocent buyer at the end of the line
who hasn't got their goods.
I was honest with them, I said, "Look, I've been part of a scam
"and unfortunately, you've been caught up in it.
"Please raise a case against me on eBay so you can get your money back."
One of the guys was fine. He said, "Thank you for letting me know.
"I'm sorry this happened to you."
Um, the three other guys were extremely mad,
saying they want their money now.
And the money... I didn't have the money.
I couldn't return the money, even if I wa... Well, I did want to,
but I couldn't return the money
so eBay returned the money to the four people
and eBay are now chasing me for the money, which I don't have.
Because Kara listed the items using her account,
she was liable and eBay were entitled to ask her
for the £400 that had been lost.
That is a lot of money to me.
That's a massive amount of money. I can't pay that back.
I should have listened to my stepdad, really.
I just think, "God, I'm just so stupid
"for actually not piecing it all together and realising."
But you're not stupid, you know,
that's really important to understand
and you're not gullible and you're not greedy
or any of those things that people say about scams.
This is a scam that works very, very cleverly.
They've had thousands of applicants for that job, and do you know what?
They've all got the job. OK?
They've all got the job. Loads of buyers all send their money,
the money gets passed on. Suddenly, the company's disappeared.
It's not down to your gullibility, stupidity, greed,
any of those things.
The scammers who targeted Kara knew exactly what they were doing
and perhaps their smartest move was to advertise the job
on the official Jobcentre website.
In Kara's eyes, this gave the company instant credibility
and is something the Department For Work And Pensions take seriously.
This is what they had to say...
So what do you need to know
to make sure the job you're applying for is safe and legitimate?
Look at the job you're actually doing and just think,
"Is this really what I expected I would be doing?"
And if you are being asked to move money through your account
or sell goods you've never seen, alarm bells should start ringing.
If they are asking to you complete an application form,
be very careful about the details that you provide.
When you apply for a job,
you should never give out your National Insurance number
or date of birth or bank account details.
They could be used by a fraudster to steal your identity
as well as your money.
Find out as much as you can about the company offering the job,
how long have they been trading,
are they registered with Companies House,
are there any horror stories about them on the internet?
Sadly, this is too late for Kara
and in the future, she will be much more cautious about finding a job.
Trying to sell your car can be a right pain in the Bugatti.
The last time I tried - two weeks, not a sniff.
If you're more successful,
you have a string of jokers coming down your drive, kicking your tyres,
drinking your tea, sucking air back through their teeth at the price.
Wouldn't it be wonderful
if there was a service which just for £100
lined you up with serious buyers?
Guess what, there is. It's called car matching, and for a fee,
companies promise to find buyers for you,
making selling your car as easy as pie.
and over the last few years, a succession of car matching scams
have hit innocent motorists where it hurts most.
It's not unreasonable to estimate that the loss to the public
from those activities was probably about £10 million.
Around 6 million used cars are sold every year in the UK
and scam artists have wasted no time trying to exploit this demand.
Over the last five years, car-matching scams
have been a serious concern for those in the motoring industry.
Unfortunately, we've heard many tales from our readers
who have been caught up in these car-matching scams.
Like all the best scams, it is deceptively simple
and lots of people, unfortunately, have been taken in by it.
The scam works just like this - you want to sell your car,
so you put an advert in the newspaper or magazine
and then you receive a phone call from a company that claims
to have lots of buyers lined up for your car, and of course,
that's appealing and they say,
"We've got buyers for your car.
"If you give us a sum of money," it is usually around £100,
"we'll put you in touch with them and sell your car, effectively."
It is a familiar sounding story for Paula
who lives near Bath with her husband, Richard.
In 2008, a sudden change in circumstances
left them needing to sell their car.
My husband had some bad news at beginning of 2008
when he was diagnosed with Alzheimer's disease
so obviously, he couldn't drive anymore, so we put it up for sale.
Paula advertised their carefully driven five-door hatchback
for a very reasonable £2,500.
The advert was placed in a local magazine, but the phone didn't ring.
Then one day, a man phoned up who said he could sell the car for her.
He said that he had a buyer for the car.
He could guarantee us a minimum of £2,650,
which was great because we'd only advertised it for £2,500.
So we thought, "That's good."
The man was calling from a car-matching company
called Vehicle Seller UK Ltd
and he had a slick sales pitch.
He said they had a database of buyers
who were looking for cars such as this
and it was going to cost me £89.99.
Paula was told the car would also be advertised
on Vehicle Seller's website
and £90 was starting to sound like very good value.
So you're then to pay £90, but the process will be cut short
and you will have achieved your sale.
Sandy's story is almost identical.
She'd been trying to sell a sporty convertible
which she'd bought as a treat to herself.
I enjoyed it for just over a year.
Then I thought, "OK." I paid for it and I thought, "Time to sell it."
That's the reason. It just wasn't big enough for the family, really.
Sandy advertised her smart low-mileage convertible
for the bargain price of £7,000.
After three weeks, no-one had rung about the car,
but then Vehicle Seller UK got in touch.
The guy that rang me up,
he said there was a lot of people waiting for cars like mine.
There was actually people queuing for cars like mine
and it would be gone, like, within a week and I would have no problems.
Sandy was sceptical at first,
so the salesman suggested she go away and look at their website.
I spoke to my husband and said, "What do you think?"
We looked at the website,
there was cars actually on there like mine, so a proper website.
So we thought, "OK, it seems legit, it seems all OK,
"maybe if he does ring me back, we'll go for it."
The salesman phoned back and Sandy found herself parting with £200.
The longer you leave it, the less money you're going to get for it.
It was a good deal, really.
But as soon as Sandy and Paula handed over their cash,
the salesman at Vehicle Seller UK went mysteriously quiet.
I mean, the thing that worried me,
that he had phoned me twice or three times in one day
and then the next day when I was having qualms,
I couldn't get hold of him.
I didn't hear nothing, so I wanted to know what went on,
so I was ringing this phone number
and it just rang and rang.
Desperate to find out what was going on,
Sandy got in touch with someone else whose car was being advertised
on Vehicle Seller's website.
I rang him and I said to him about selling his car
and he told me he had been with this company a year
and he has not had one phone call.
So in my head, I was thinking, "This ain't right.
"This has got to be a scam."
And Sandy was right.
She and Paula had become the latest people
to be duped by Vehicle Seller UK,
a company who had conned thousands of others in a similar fashion,
but not for much longer.
Sandy, Paula and scores of unhappy customers
complained to Trading Standards.
Trading Standards called in the Insolvency Service,
a government agency which has the power to shut companies down
if they're up to no good.
Paul Titherington is an official receiver for the Insolvency Service
and was one of the men charged with investigating Vehicle Seller UK.
It wasn't capable of providing the service
that it purported to customers it would provide, and therefore,
customers were not receiving a service that they paid for.
The challenge for the Insolvency Service was to prove
that Vehicle Seller UK Ltd had never intended
to provide a real car-matching service
and that the company was set up to scam people like Paula and Sandy.
To do this, they needed to know
what Vehicle Seller UK had been promising,
whether they had any car buyers on their books
and whether they'd helped anyone sell their car.
Step one was to look at all the complaints
and see if there were any common threads.
When initially looking at how Vehicle Seller had run its business,
we were looking at what it was telling customers
about the service it was to provide.
That it had numbers of customers
waiting to buy that particular vehicle.
If they paid now, it's likely they would be round that night, the customer, to buy the vehicle.
It was also saying that the likelihood was
that the seller would get more from the customer
than they would do by selling it elsewhere,
It was starting to become clear that Vehicle Seller UK Ltd
had a very good reason for only charging a relatively small amount.
The customer's unlikely to do too much about it,
they'll just chalk it up to, "Unfortunately, I've lost £100,"
The Insolvency Service now knew the tactics
Vehicle Seller UK Ltd were using to get people to part with their cash.
The next stage was to start gathering hard evidence
so Chris Mayhew, the company's investigation supervisor,
set his team to work.
We appointed an investigator to exercise statutory powers
and go out to the trading address and carry out an investigation.
The investigator was armed with a warrant
allowing him to search Vehicle Seller's offices
and seize any relevant documents, but when he got there,
he found the company had virtually no records,
either on computer or paper.
If a company is acting legitimately,
you would expect accounting records,
co-operative staff, co-operative officers behind the company.
With limited company records,
the investigator had to painstakingly piece together evidence
from what little paperwork there was
but as he did, the full scale of the scam began to emerge.
Vehicle Seller had boasted they had 3,000 clients on their books,
but it seemed most of them
were people like Sandy and Paula who had been scammed.
Our investigator was able to ascertain
that there were over 2,700 complaints.
It's probably fair to say in this instance
that of all the alleged 3,000 people on their books,
not one person actually sold a car through this company.
The Insolvency Service now had the evidence they needed
to take Vehicle Seller UK to court.
The team prepared their case
and put together a winding-up petition,
a recommendation that Vehicle Seller UK Limited be forced to close down.
That letter came before the High Court
who agreed with the findings and ordered the company into liquidation
on grounds of public interest.
So in April 2009, six months after their investigation had begun,
the Insolvency Service closed down Vehicle Seller UK for good.
But the Insolvency Service weren't done yet.
They wanted to make sure the men behind the company
didn't just go off and start all over again.
So in came Paul Titherington.
On the winding up of a company,
the job falls to me to investigate its affairs,
to identify its cause of failure
and to decide whether there is misconduct
on behalf of the directors that warrants action
under the directors disqualification provisions.
Paul needed to interview the two directors of Vehicle Seller UK Ltd
to see if they could explain
why they hadn't provided the service they promised
and why there was such huge blanks in the company's records.
A significant amount of money had been withdrawn in cash
and there was no explanation where that had been, where that had gone.
There was also a significant amount of payment by way of cheques.
Again, no evidence to where that money had gone
and whether it was a legitimate expenditure
on behalf of the company.
The directors were called in for interview
but nothing they said could legitimately explain the goings-on
at Vehicle Seller UK Ltd.
It seemed certain that the company had been set up purely
to con people out of their cash.
The courts decided to disqualify both men
from being a company director for 11 years.
So, thanks to the hard work of Paul, Chris
and the Insolvency Service team,
Vehicle Seller UK Ltd and its directors
could no longer pose a threat to innocent people
like Paula and Sandy.
And there' been more good news for anyone selling a car,
Along with Vehicle Seller UK Ltd, the Insolvency Service
have investigated another ten car-matching firms
and taken action against the con men behind them.
There have been eight directors banned for ten years or more
and another eight have been banned from five to ten years.
This seems to have put the brakes on car-matching scams for now.
But if you're selling a car, you should still be on your guard.
Here's what you need to know to avoid the con men...
You shouldn't be put off trying to sell your used car yourself
because there's lots of good websites out there.
There's lots of good magazines. Lots are household names.
Sell your car there. Describe your car well.
Get your car nice and clean and tidy.
Offer it a fair price and you'll sell it through legitimate means.
For further advice on how to protect yourself against scams, go to...
Now, before we go,
there's just time to tell you about some of the latest scams out there.
I've come to meet 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 that target our health.
I'll be honest with you, Mike. I've put a few pounds on recently.
If you're a scam artist, what are you going to do for me?
Well, I've got latest miracle slimming pill, Matt.
In fact, you can carry on eating as much as like, you can have cakes,
chocolate, anything, take these pills four times a day
-and I'll guarantee you'll lose weight.
Absolutely. Just send me £19.95 a month for the next six months,
you'll get your pills.
-What am I actually getting?
-Who knows what you're getting.
What we know, it's something that won't work.
Yes, this news just in -
there are no miracle cures when it comes to losing weight
and if you order pills from the internet,
who knows what you'll get through your door.
But weight-loss pills aren't the only health scam out there.
In fact, there are more harmful types of scams
where the scammers will actually promise
that they've cures for incurable diseases
or can stop your arthritis, for example, or cancer
and this robs people of their hope
as well as robbing them of their money.
It's just someone in a grubby office sending out these types of pills
which won't do you any good at all.
No matter how desperate you are for a cure,
don't take anything without seeking medical advice first.
Speak to your GP before trusting claims made in an e-mail or website.
So 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
Karla is one of the millions of people in Britain currently looking for work. Matt meets her and hears how she was ruthlessly drawn into an employment scam that played on her desire to work.
Plus, the million pound scam that targeted people selling their cars, and the miracle cures that are simply a way to get at your cash.