Category: Warning

Mini Bonds Warning

A mini-bond is essentially an IOU issued by a company to an investor, in exchange for a fixed rate of interest over a set period of time. At the end of this period, the investors’ money is repaid.

This is how bonds of all kinds are used. The investor gets interest on the ‘loan’ and the company gets  cheap money for a period, essentially.

There is no legal definition of a ‘mini-bond’, as opposed to a normal bond, but the term usually refers to bonds for relatively small businesses, often retailers, that may struggle to raise money on larger markets.

Typically, the bonds are for three to five years, and investors earn regular interest payments during the life of the mini-bond. Some bonds offer rewards in another form such as discounts on their products.

The return on investors’ money entirely depends on the success and proper running of the issuer’s business. If the business fails, investors may get nothing back.

The Financial Conduct Authority (FCA) say that Mini-bonds typically offer high returns and this reflects the much higher risks involved compared to other types of investments. A business does not generally have to be regulated by the FCA to issue mini-bonds and there is normally no protection from the Financial Services Compensation Scheme (FSCS).

Any investors should think carefully before investing in a mini-bond, and not invest any money they can’t afford to lose.

From 1 January 2020, it is against FCA rules for anyone to promote ‘speculative mini-bonds’ to retail consumers, unless they are considered to be ‘sophisticated’ or have a high net worth.

The specific type of mini-bond that the FCA consider to be the most problematic is where a company raises money from investors with the intention of lending the money to a third party or investing in other companies, or property. Being able to pay interest and repay the original investment depends on how these lending or investment activities perform. Where these products are marketed to ‘eligible’ investors, they will have to clearly state the risk of losing all of the investment, and also provide clear information on the costs and charges associated with the product.

This type of company could face cash flow problems that delay interest payments, or it could fail altogether and be unable to repay any of the money investors have lent it.

Mini-bonds cannot easily be converted into cash as there is normally no market for these bonds.

If you receive a regulated investment service, such as investment advice, relating to a mini-bond from an authorised person and they fail to meet DCA standards, you may be able to complain to the Financial Ombudsman Service.

If you have any experiences with mini bonds, do let me know, by email.

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Warning: Surrey Roadside Scam

This roadside scam is relatively rare but reoccurs in Surrey from time to time.

You’re driving along and see what looks like a broken down car and a person sitting or lying by the roadside. Many people will just drive by, but some will stop to help and that’s what the scammer is relying upon.

The scammers are generally male and well dressed – they want to look like businessmen and often pick busy roads or even motorways for this scam.

If you get out to help, then you find that the driver has simply run out of petrol and offers you his gold ring as collateral for a loan of some money to get petrol.

The ring or other proffered gold jewellery will be fake of course and your money will be gone.

The safe thing to do is keep on driving and if possible, report the incident to the Police so they can investigate if it is a genuine breakdown or a scammer.

Do not get caught out.

Have you seen this scam in your area?

Do you have an opinion on this matter? Please comment in the box below.

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Sim Swap Danger

Temporary loss of your mobile phone can be a big inconvenience but loss of your phone number to scammers can be much worse.

If you’d lost the phone, you would call the phone company or visit on of their shops and explain to the assistant that you need a new phone and your contract etc. transferred to that new phone.

The Sim Swap fraud makes use of a mobile phone service provider’s ability to easily transfer a telephone number to a device containing a different sim card.

The scam begins with a scammer collecting personal details about the victim, either by use of phishing emails, by buying the information from other criminals.

The scammer then contacts the victim’s mobile telephone provider and uses the information they have to convince the telephone company to transfer the victim’s phone number to the fraudster’s SIM. This usually means impersonating the victim using personal details to appear authentic and claiming that they have lost their phone.

More and more people and businesses rely on mobile phones for proof of identity. e.g. your bank may send you security numbers to type into your account to prove your ID but if scammers can access your phone and read your messages, they are in control.

So, if the scammers get your calls and texts sent to them instead, they can use the forgotten password option on many accounts to have new password sent to them and you wont know any of this is going on..

They may gain access to your bank account, retail accounts etc.

If a scammer attempts this fraud, you may receive SMS messages or email prior to a SIM swap taking place. If you didn’t action this request you must contact your bank and phone provider immediately.

If the scammer successfully transfers your number to their phone, then your phone may lose signal or become unable to make calls, send messages or use data. Report this immediately.

If you have any experience with this sim swap scam, do let me know, by email.

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Stupidest Spam of the Week Website Links

Everyone with a website or blog wants lots of people to see it. There are many ways to achieve this but helping people to find it on search engines is the most popular method for most people.

One of the ways to improve the likelihood of a website coming high in Google search or other online search engines is to create lots of backlinks i.e. links from other people’s website to that one.

These should be created properly i.e. by getting links in sites related to yours and where the link is relevant and meaningful e.g. a link to Brooklands Radio from a retailer who plays Brooklands Radio in their premises or from an artist featured on Brooklands Radio or from a local business that advertises on Brooklands Radio.

However, lots of unscrupulous people try to bypass this slow process by buying links from link sellers. They charge typically $20 – $50 for hundreds of links to be created.

These are usually very poor links in that they are from sites with no relevance to your web site and probably stuffed with hundreds or thousands of such meaningless links. Google and other search engines recognise this and ignore any links from those sites.

This latest email says “We provide guest post and link placement on our fitness and health site for $95 per link”. 

That’s extremely expensive compared to other link providers.

No-one in their right mind would actually pay this, especially as the email is from a Gmail account which means there is no business and no business website, just a dumb scammer.

The last line in the email says “The price is negotiable.” which reeks of desperation.

Too bad, loser.

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OneCoin Cryptocurrency Scammer in Court

Mark Scott, a US lawyer accused of laundering proceeds from the OneCoin cryptocurrency – alleged to be a Ponzi scheme scam – went on trial in New York. He was accused of laundering approximately $400 million through hedge funds and transferring that back to his colleagues.

OneCoin claims to be a digital currency similar to Bitcoin and the founders are thought to have raised an estimated $4bn worldwide, including millions from the UK, since it began in 2015.

It was founded in Bulgaria by Dr Ruja Ignatova, who disappeared in 2017 and her brother Konstantin Ignatov, who ran the company in her absence and has since been arrested in the US.

The Sales Pitch

Dr Ruja, told her audience that the future belonged to cryptocurrencies such as Bitcoin, which had made millions for many investors and were free of the high cost of traditional banking.

She offered an alternative – a perfectly safe cryptocurrency of her own devising called OneCoin. She exhorted people to join this financial revolution that would become bigger than Bitcoin within a few years

It is estimated that up to 70,000 people in the UK may have invested with OneCoin and hence lost everything.

It appears to have been a fraud from the beginning as investors trying to retrieve their money found out, when they couldn’t get anything back.

The banks realised it was a scam and stopped doing business with OneCoin. So Ruja moved to using money laundering with people such as Mark Scott.

The officials are keenly trying to find Ruja to put her on trial as well.

If you have any experiences with Onecoin, do let me know, by email.

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