This lesson can not be emphasized enough, when it comes to investing your hard earned dollars, be careful who you trust. No matter what you are told, consumers must also remember all investments carry risk.
"He was told his original investment was guaranteed…it was supposed to double his returns within 90 days," said Tammy Mayle, US Postal Inspector.
So, the wealthy, retired businessman decided to invest $3 million.
Attorney John Brewster explained the pitch. "At the highest level of banking in Europe, there were-unbeknownst to most people-bank notes traded between institutions."
The scam artist, claiming to be an international financier, promised he'd be buying the notes at half their face value and selling them to other banks across the globe for almost twice as much.
"It was guaranteed he would not lose his money," said Mayle.
A short time after investing his $3 million, the victim, who was in his 80's, got back $1 million.
"They gained the trust of the victim," explained Mayle.
As for the other $2 million, over two years, the scam artists kept coming up with excuses as to why it hadn't doubled.
"The money was never invested anywhere. It never left the fraudster's bank account. He was living off the money," said Mayle.
Including purchasing a $500,000 luxury RV.
"He was devastated. He was incredulous that anyone would take advantage of him in this way," said Brewster.
Especially given the fact that the $2 million had been earmarked as a donation to the victim's church.
"The victim died before the case was finished. His wife wrote a letter to the judge saying he was never able to use the investment for his church and he died of a broken heart," said Mayle.
The two scam artists in this case both plead guilty. One was sentenced to 46 months in prison, the other 30 months.
Some advice for avoiding scams like this:
- Don't fall for the promise of quick, unrealistic returns or claims that no money will be lost.
- Beware of investments requiring you to wire the money. Wire transfers make it easy for con-artists to move money around to many different banks.