Harewood Associates - the final word

bowlhead99

Jones101 wrote: »

How can you call the majority of unfortunate people who have retired or well into their pension years as stupid? These investment companies are run by crooks who pray on the people looking for alternative savings, are assured by the pitfall safety nets then cruelly duped.

Instead of calling them stupid it is perhaps better to say they were greedy, naive or some other attribute that also sounds like an insult. That's the inconvenient truth.

The main reasons that crooks make money off them via 'alternative savings' schemes are:

- if they are easily seduced by too-good-to-be-true claims of good returns with low risk, because they are greedy; and/or

- they do not carry out any proper research to get truly comfortable that it is not a scam and is not high risk, because they are lazy and can't be bothered, or are a hopeless optimist, or not well educated, not possessed of natural cynicism, or just generally not smart.

Sometimes, the type of person who did *not* get caught by the scam or investment failure - and warned people against it every time they enquired about it - will say that the people who lost money in it were 'stupid', but this is just a shortcut way of generalising when in fact those people were not particularly stupid, just variously: greedy, lazy, hopelessly optimistic, not sceptical, not educated, not comfortable with financial matters or not smart.

The people caught out may think that they are just 'unfortunate', as most people in the country do not get caught by such scams, but some of that is to do with the fact that most people take more notice of warnings, have heard of investment scams and are on their guard, do not follow investment adverts on social media or seek out investments through quick Google searches, don't accept 'cold calls' about what to do with their life savings etc. There is some truth in the phrase "you make your own luck".

It is easy to be a bit too disparaging - from a position of knowledge and experience - that the suckers who were caught by con artists were idiots or somehow deserving of their fate. That's unfair. But the fact that con artists love people who are greedy, lazy, not well educated, not sceptical, don't know better about financial matters... means that a lot of the victims do come from those categories and so you can perhaps understand why people on here will generalise.

If a conman tries to reassure you that there is a good safety net, yes some people will fall for that at face value. While other people will not commit any substantial amount of money without investigating independently whether that safety net really exists, what practical use is it going to be in the case of an investment failure, could the safety net fail too, etc. The people in that latter category are the ones who generally won't invest, because they realise that it would cost them a great deal of effort to get independent verification of how good a deal it is or isn't. Whereas the people in the first category who take things at face value are more likely to get hurt.

The simplest way to approach these sort of things is to say: if this is a safe savings scheme with no practical chance of failure or loss of capital, and a safety net of things go wrong, why is it able to be paying a lot more than the top bank accounts? Or, if it has little to no risk, why is it paying as much as the regulated investment products which do admit to having risk. Is that realistic? If so why isn't everyone in the country using this product!

Such scepticism is not as common as it should be, and some of it is a lack of education. It would be nice for the people without the education if we help them avoid future catastrophes by talking about these scams and how people got duped and how with hindsight they could have been smarter to not get caught next time - what warning signs they should have been alerted to.

It can be counterproductive to talk about the victims as stupid because perhaps they will not share the details of their other personal financial affairs for fear of being ridiculed. I would rather have it that my grandma is open and forthcoming about the offers she wonders about, so that someone with more knowledge can help her out.

And hopefully those people who offer to help her out will be trusted family members who have heard of investment scams. Rather than actual conmen, or well-meaning ladies in her social circle who are just at oblivious as she is. It's a shame that some people don't have anyone they can ask about this stuff. Still, that's why internet forums like this are a valuable resource.

Southeycapital

Couldn't agree more with the previous poster, but would add that actually many people who have fallen victim to these and other investment scams have also been given "fraudulent" advice.. not sure what the right term is for one that gives advice but is being paid by another party.. you can't just dismiss people that would like to put some faith and trust in a IFA/ fiduciary etc, they are sometimes just tricked.

SonOf

but would add that actually many people who have fallen victim to these and other investment scams have also been given "fraudulent" advice

Most of the scams do not involve advice. Those that do tend to have consumer protection.

not sure what the right term is for one that gives advice but is being paid by another party.

Advice is a defined meaning when it comes to regulated activity. Harewood never gave advice.

you can't just dismiss people that would like to put some faith and trust in a IFA/ fiduciary etc, they are sometimes just tricked.

Harewood were not IFAs.

Malthusian

SonOf wrote: »

Most of the scams do not involve advice.

Actually, m'lud, they do. It just happens to be illegal advice. The FSCS has recently been made clear that an unregulated scammer telling you that they'd tell their own mother to invest in this constitutes advice.

Unregulated, illegal and non-FSCS-protected advice but advice nonetheless.

You are however likely to be correct that no IFA recommended Harewood. You can't conclusively prove a negative, but the evidence is strong that Harewood did their own marketing. If they did use introducers they weren't IFAs.