• Tallman

Super-rich scam victims hire private investigators to get their money back

Just one in every 500 scams results in prosecution, leading the rich and famous to find other means to get their millions back

Ultra-wealthy scam victims are hiring private investigators and prosecutors in order to get their cases solved, as the police force fails in 96pc of cases.

Around 500 high net worth individuals, with average losses of around £20m, seek help from Edmonds Marshall McMahon, a law firm staffed by former employees of the Serious Fraud Office and Crown Prosecution Service each year.

Victims turn to the service after becoming frustrated by the lack of police action, said co-founder Tamlyn Edmonds. EMM uses its team of private investigators to gather evidence and prosecutes in more than half of cases. An average fraud victim, by contrast, has a one-in-500 chance of their case resulting in prosecution, official statistics show.

“It is harder than ever to get a prosecution by normal means during lockdown. Cases are being adjourned as fraud is not a top police priority at the moment,” Mrs Edmonds added. The highest amount the firm has ever won back for a client was more than £300m. Although the sums lost are higher than for most scam cases, many of the ruses used by criminals are the same only more elaborate, she added. “Often they will pose as a bank employee and ask you to transfer them money or they pretend to be putting your money into investments.”

In one case a Kazakh businessman was tricked into transferring around £900,000 to what he thought was his own account with Standard Chartered bank. It was in fact controlled by a fraudster who was pretending to set the account up for him. The victim flew to Hong Kong to attend a meeting at what he believed to be the bank’s office.

“Not only did the fraudster create a fake office in a skyscraper, he even created a fake banking portal which the victim used to transfer the money,” Mrs Edmonds said.

The victim contacted EMM after the British police declined to investigate because the Hong Kong police would not cooperate, she added. The law firm identified and prosecuted the perpetrator, a Russian and British national, who was sentenced to five years’ imprisonment.

Another client managed to win back more than £12m which he believed was being invested for him in business ventures. During proceedings the scammer claimed that all of the money had been spent and could not be recovered yet further investigation revealed he had millions of pounds hidden via family members and staff and was spending huge sums on luxury holidays, restaurants and hotels.

Criminals have capitalised on confusion during lockdown to find new ways to trick people into handing over their money. More than 2,100 cases of Covid-19 scams have been logged by Action Fraud, the national fraud reporting centre, since February, with losses totalling around £5m.

“Fraudsters are increasingly targeting high net worth individuals via online dating sites or by posing as fake charities,” Mrs Edmonds said. “Rich divorcees are being tricked into handing money over to people they believe they’ve started a relationship with during lockdown.”

If a client’s case goes to private prosecution they can recover the costs either from the defendant, if they are convicted, or from the state. “The rationale for this is that the private prosecutor is fulfilling what should be a state function and therefore should be compensated for the costs incurred in bringing the prosecution,” Mrs Edmonds added.

Ashley Hart, head of fraud at bank TSB, said it was easy for well-off, well-educated people to assume they would never fall victim to a scam. However official research shows it is wealthy, middle-aged people who are the most likely to do so. Around 8pc of adults earning £50,000 or more have been the victim of fraud, according to the Office for National Statistics.

By Marianna Hunt, 10 June 2020, by The Telegraph

Image by Gerd Altmann from Pixabay


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