Getting conned is one thing, but it’s a whole new level of misery when you appear to earn a lot of money, only to discover that the fraudsters can prevent you from receiving it.
This occurred to James (not his actual name) when a “friend” introduced him to a good investment after the pandemic severely reduced his income.
The “friend” convinced him to establish a foreign-exchange (forex) trading account and provided him with “insider tips” so that he could trade and generate a profit.
James, 55, who previously earned a five-figure salary in the tourism industry, initially invested $800,000 and parlayed it into $8 million through astute trading. However, his good luck quickly transformed into a nightmare when he was unable to withdraw the money.
Later, he discovered that his funds were never used for genuine forex transactions, but were instead transferred directly to the scammers’ pockets.
A new technological con
The criminals developed a website for online trading that replicated the platforms of legitimate trading institutions. This meant that they were paying certain companies for the privilege of using their custom-built trading software.
The victims who are duped into trading would see live broadcasts that resemble the real thing but with one crucial difference: the criminals can manipulate the outcome to make the victims believe they have won the jackpot.
This was the case for James, who appeared to make substantial profits whenever he heeded the advice of others. This is a very subtle fraud because they provide him with an account and he trades on his own.
This made him feel secure because he believed he was in charge. However, they were manipulating him the whole time. James received a message from an unknown sender in February last year that read, “Hey, I’m back in Hong Kong now.”
He erroneously believed the sender was a restaurant owner he had befriended during previous business visits to the city.
He says, “In retrospect, I regret divulging too much information during our conversations. I stated that the pandemic had severely impacted my income. Therefore, the con artist preyed on my weakness.”
About a month later, under the guise of assisting him, the “friend” sent him information about a forex trading house, encouraging him to try his luck and make some money to tide him over until his next paycheck.
The “friend” promised to provide him with helpful advice and assured him he would acquire trading confidence gradually. “It seemed intriguing. “Since I was the one making the trades, I saw no reason not to give it a shot, given that this ‘friend’ claimed it was simple to make money,” says James.
He was led to assume he was dealing with a legitimate Hong Kong trading house because he was required to submit personal documents and complete an investor questionnaire to ensure he understood the risks associated with such trades.
James desired to initiate the trade with roughly $20,000 and was advised to purchase cryptocurrency because the funds could be transmitted instantly. James did not suspect anything because he was making consistent profits, despite the fact that this is not the norm for most trading houses.
At one point, he requested a withdrawal of $100,000, and the funds were transferred to his local bank account almost immediately. This persuaded him that the trades were legitimate, and he ultimately invested $800,000 of his life assets in the game. By September of the previous year, his account had nearly $8 million in it. His request to extract $400,000 was denied due to “seasonal accounting procedures.”
A few days later, he made the same withdrawal request, but was again denied because he had not yet paid taxes on his gains. Normally, taxes would be deducted automatically at the source, and individuals would not be required to pay.
James contacted the Hong Kong tax authorities to confirm this, and he was stunned to learn that they had no record of his investment. Then came the bombshell: such a trading house did not exist in the city.
Unsurprisingly, James was left in the lurch when all communications related to the fraud were severed. He then reported his loss to the Singaporean police.
As soon as he joined the Global Anti-Scam Organisation’s support group, he realized that the fraudulent trading house was likely based in Indochina, not Hong Kong.
“I only deal with regulated businesses. I did not conduct due diligence on this corporation because I believed it was headquartered in Hong Kong. “I had faith in the system and did not see this coming,” he says.
Even an experienced investor like James was deceived by the sophisticated software used in the fraud, believing his transactions to be legitimate.
Source: Straight Times