A married couple were convicted last week for heading up a cold calling investment scam targeting elderly victims with a total loss of over £2.7 million. It’s not often we see white collar crime punished in the UK, so this is a refreshing piece of news.
Southwark Crown Court found Clint Canning guilty of fraud by false representation and Eleise Wallace guilty of a money laundering offence.
The court heard that Canning had been running a binary options investment company, Base 2 Trade, which claimed to be involved in fixed odds betting on the trading direction of businesses.
Investment Scam Red Flags
The company is not registered with the Financial Conduct Authority nor present on Companies House records -both giant red flags. Their bold claim was that investors who correctly predicted the direction that the price of a share or asset would go would receive a return. Their whole business model is what we would use as an example in ‘spotting scams 101’. This is not the way a legitimate investment firm would operate.
Victims were then not able to withdraw their money, investments or profits, with Base 2 Trade blaming technical contractual reasons. Another classic excuse as to why funds can’t be retrieved. We also see a lot of digital ‘technical issues’ pop up.
Crown Prosecution Service lawyer Claire Busby said: “This was a callous and cruel investment fraud which duped around 173 victims into thinking they were buying into a legitimate fixed odds betting scheme. The scheme proved to be a scam, designed only to defraud victims of their money.
“The fraudsters presented themselves in a credible way and secured the trust of many victims. The only people to benefit from the schemes were the fraudsters themselves.”
Education Is Needed
As an industry, we need to up the ante on investment education. The rate at which these schemes are popping up is staggering- not to the mention the rate that innocent people are falling for them. A lot of people, especially elderly, may not be particular technologically savvy. Therefore, they may not have the means to undertake due diligence. We need to reach them in other ways– and this is what UK Investment Review aims to do in 2023.
On the plus side, its refreshing to see perpetrators of investments scams getting punished via the legal system. All too often, these criminals -because that’s exactly what they are- get off scot free. Perhaps the tide is turning. The couple will be sentenced on February 3rd 2023.
This message serves as a warning against potential online scams, including website scams and investment scams. Please exercise caution and conduct thorough research before engaging in any online transactions or investments. Protect your personal and financial information from fraudulent activities, and consult with trusted sources for advice.
Insolvency and Law Peter Murray is an award-winning consultancy firm specialising in Insolvency, debt purchasing and business rescue.