Skip to main content

OLDER PEOPLE TARGETED IN £28M INVESTMENT SCAMS

15 June 2012 00:01

Insolvency Service

The Insolvency Service is warning older people and their carers to watch out for bogus retail and investment schemes aimed at them, as figures show 78 rogue companies that raked in over £28million from the public have been shut down in England and Wales in the last three years alone.

Between them, the companies, which represent around one in ten of over 800 companies wound up by The Insolvency Service in the three years between April 2009 and March 2012, scammed close to 2,000 investors. Information obtained by The Insolvency Service has shown that the oldest person was 92.

Forty-nine of the companies sold plots of land for ‘building’ that either didn’t exist or were on protected green belt land; four sold wine stocks that did not yield any profits, and nineteen sold other forms of investment. Six sold retail products that were either unsuitable or at highly inflated prices, including burglar alarms, mobility scooters, ‘heritage’ coins and stair-lifts.

The Insolvency Service is being supported by three charities Age UK, Alzheimer’s Society and Action on Elder Abuse, to warn the public about these scams, on the same day that campaign actions to highlight World Elder Abuse Awareness Day are taking place.

The warning, also aimed at friends and families of older people, stresses that such scams typically employ the telephone equivalent of ‘door-stepping’. They phone older people and often refuse to come off the phone until they have closed a sale.

The retail scams often involve pressurised selling of an unwanted product to an older person, or a product at a grossly inflated price, carried out during a home visit or through doorstep selling.

Business Minister Norman Lamb said:

“These scams are especially bad as they target some of the most vulnerable members in our society. Older people have grown up trusting other people. To take advantage of this trust, and then exploit it is both manipulative and deceitful.

“I support the work Insolvency Service and its partners are doing to warn older people, and would urge people to be vigilant when approached to make investments out of the blue.”

Robert Burns, Head of Investigation and Enforcement for The Insolvency Service said:

“We have observed a number of companies targeting older people in recent months. These scams are particularly unpleasant because they target the most susceptible members of society, older people who may be unsure how to seek advice or afraid to say “no”. They can destroy lives at a time when those targeted should be taking a break from worry and enjoying life after working hard.

“Victims are paying for something and getting nothing. The worst aspect is the callousness with which the fraudsters go about their business; ignoring the obvious fact that that because of their age, most victims will never be able to make good their loss.

“Not one of the landbanking companies we have investigated and wound up has seen a profit for the investor. If you are cold-called, don’t be afraid to say ‘no thank you’. If in doubt, you should take time to research the company and get some independent advice.

“Today is World Elder Abuse Awareness Day and we would urge all friends, carers and family members to be vigilant and look out for the older members of their family to ensure that they are not scammed by rogue businessmen.”

Michelle Mitchell, Charity Director General at Age UK, said:

“Scammers will often see vulnerable older people as an easy target. Scams can take place on the doorstep; by phone, on the internet or through the post and the sad fact is that if something sounds too good to be true then it probably is. If you feel under pressure to commit, then just step away because any reputable company will allow you time to think an offer over.

“Anyone can be taken in by a scam so people shouldn’t be embarrassed to report a crime. If you feel you are or have been a victim speak to the police, a family member or friend.

“Age UK have produced two free information guides ‘Avoiding Scams’ and ‘Staying Safe’ which provide practical steps to ensure older people are able to protect themselves against this type of crime in their home and on their doorstep.”

Alzheimer’s Society is also campaigning against the financial abuse of people with dementia.

Jeremy Hughes, Chief Executive of Alzheimer’s Society said:

“There are currently 800,000 people living with dementia in the UK. Many are older people and easy targets for con artists. It is disgusting that these scams specifically target the most vulnerable in our society. Con artists are dealing another blow to people who may already be struggling financially due to the huge cost of care. Everyone from banks to the general public needs to work together to stop these scams and help protect those who need it most.”

Gary FitzGerald, Chief Executive of Action on Elder Abuse, said:

“Research tells us that over 342,000 older people face abuse in our communities every day. They are too often seen as an easy target by unscrupulous people out to make ’easy money’ and it is therefore crucially important that we are all vigilant in their defence. Families play an important part in helping older people to protect themselves against fraudsters, and a little bit of planning ahead can make all the difference.”

Companies that rip-off older people have always been around, but it’s more difficult to track today as the fraudsters continually change the commodities they’re selling. Older people also find the whole sales pitch very confusing. Quite often the fraudsters return saying that extra investment will secure even better returns.

Notes to Editors

1. For examples of companies wound up by The Insolvency Service that ripped off their customers, including older people in, please call the Insolvency Service Press Office.

2. The Insolvency Service administers the insolvency regime investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. The Service also authorises and regulates the insolvency profession; deals with disqualification of directors in corporate failures; assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees; provides banking and investment services for bankruptcy and liquidation estate funds; and advises ministers and other government departments on insolvency law and practice. Further information about the work of The Insolvency Service is available from www.bis.gov.uk/insolvency.

3. Investigations and Enforcement Services carries out a range of activities aimed at supporting fair and open markets and, where necessary, taking steps to safeguard those markets from companies and individuals whose conduct is not conducive to the public interest. We undertake enforcement activities under the powers available in the Insolvency Acts 1986 and 2000, the Company Directors Disqualifications Act 1986 and the Companies Act 1985.

4. Officers within the Metropolitan Police Service's Specialist and Economic Crime Directorate have also produced a comprehensive fraud prevention booklet entitled, 'The Little Book of Big Scams', also launched on 15 June 2012. See: http://www.met.police.uk/fraudalert/docs/mps_little_book_big_scams.pdf

5. The guide explains some of the most common scams in existence, ranging from the simple to the sophisticated and provides the reader with essential advice to reduce the chances of them being parted from their money.

For more information and examples of companies wound up by the Insolvency Service, please contact the press office:
Kathryn Montague, Media Relations Manager, on 020 7674 6910 Kathryn.montague@insolvency.gsi.gov.uk.
Jemima Broadbridge, Press Officer, on 020 7637 6422 jemimabroadbridge@insolvency.gsi.gov.uk

Alzheimer’s Society champions the rights of people living with dementia and the millions of people who care for them. Alzheimer’s Society works in England, Wales and Northern Ireland. Alzheimer's Society supports people to live well with dementia today .

For more information, visit alzheimers.org.uk · Alzheimer’s Society provides a National Dementia Helpline, the number is 0845 300 0336 or visit alzheimers.org.uk.

Alzheimer’s Society is The Insolvency Service’s charity of the year for 2012.

Press Office 0207 423 3595 Email: press@alzheimers.org.uk To find out more about how Age UK can help, call 0800 169 6565, visit www.ageuk.org.uk or speak to your local Age UK branch.

Action on Elder Abuse is a national charity that aims to protect, and prevent the abuse of, vulnerable older people. It does this by raising awareness of the issues, encouraging education and by giving information and support to those in need. This year it is co-ordinating efforts around the UK to raise the profile of World Elder Abuse Awareness Day. For further information on Action on Elder Abuse go to website: www.elderabuse.org.uk.

Contact Information

Kathryn Montague
Name
Kathryn Montague
Job Title
Division
Phone
0207 674 6910
Fax
Mobile
Email
kathryn.montague@insolvency.gsi.gov.uk
Jemima Broadbridge
Name
Jemima Broadbridge
Job Title
Division
Phone
Fax
Mobile
Email
jemima.broadbridge@insolvency.gsi.gov.uk