|
|
 |
|
| Gems & Jewelry |
Swindler’s List
Carol Besler
05/03/2004
|
Warning Signs
The swindles
typically start with a mailing, usually a brochure, from a phony financial
management company, touting the investment value of gems. The mailing includes
articles from legitimate journals about the value of gemstones, particularly
about high returns on rare gems. The former con man who spoke with Worth would
attach articles from the Wall Street Journal and the New York Times. He would go
so far as to place ads in magazines read by affluent Americans. Those of us who
respond to the ads or brochures become prospects (although the criminals may
obtain our names in myriad other ways, too), and the con rings put our names on
lists that circulate among phony investment companies.
 The now-reformed con
man was, in the parlance of swindlers, a skilled “opener.” He would claim to be
calling from Zurich Exchange or Curtis Davies or another legitimate-sounding
investment house. “I implied that investors could liquidate their gems any time
through me for a 10 percent fee. But I told them, ‘This is a two- to five-year
investment.’” This gave him just enough time to disappear.
He targeted the
very wealthy, knowing we tend to measure the cost of opportunity differently
than the average investor, and can often bear the risk of investing in illiquid
assets. He also positioned the gem purchases, incorrectly, as a tax-advantaged
investment as a further lure to affluent individuals. A successful sale would
take, on average, one mailing and a couple of phone calls, he claims, adding
that he made a sale to one out of every six or seven prospects.
Those of us
who become ensnared in one of these scams usually receive the gems in
Lucite-sealed packages with phony certificates and a warning that breaking the
seal renders the certificate invalid. This prevents us from having the stones
appraised. These criminals sell us the stones for up to 1,200 times their true
value.
|
|
|
|
|
|
|
