Losing money to a scam investment scheme is bad enough. But then being targeted a second time by bogus officials asking victims to hand over personal details with false promises of getting their money back… it’s enough to make you wonder if there’s any justice in the world.

Reports of just such a so-called recovery room scam targeting investors who were duped into backing a rogue wine company have prompted the Insolvency Service to issue a warning. 

What makes it even worse is that many of the people being hounded again are known to be elderly and vulnerable.

The sorry story stems from the case of Global Wine Exchange, a wine investment vehicle that was put into compulsory liquidation in the public interest in March 2022 for a litany of misconduct offences.

The company was judged to have abused £1.9m in clients’ funds obtained via high-pressure sales techniques and false promises of returns that never materialised. An Insolvency Service investigation found that representatives were cold-calling customers, several of whom were found to be elderly and/or vulnerable, including one who reportedly had Alzheimer’s.

In a chilling echo of what was to come later, many of the people targeted were previous customers of another failed wine investment wheeze, Bordeaux Wine Company, which was liquidated in August 2021. These customers were told they would get back the money they lost by investing again.

Of course, the returns never came, and nor did customers ever receive delivery of wine they were supposed to receive as part of the deal.

Don’t give cold-callers the time of day

Now some of these same people who have already lost out twice are reportedly being targeted by scammers posing as trading standards officials, asking for details of their investment in Global Wine Exchange. Victims are being falsely told that sharing the information with them is their only opportunity to claim back the money they lost.

This is a common modus operandi of what are known as recovery room scams - rackets that target people who have lost money in failed or fraudulent investments, telling them they will get their money back if they hand over sensitive personal details.

The reality is that, in the case of a compulsory liquidation or any other kind of insolvency procedure, the only person who can handle recovery claims on behalf of investors is the registered insolvency practitioner (in this case, the Official Receiver) appointed to handle the case. A Receiver will never outsource claims handling, nor will they contact victims out of the blue - the claims have to be initiated by the investor.

So the moral of this sorry tale is to be on your guard about anyone cold calling you. Scammers like this will pretend to be anyone - debt collectors, trading standards officials, insolvency professionals, but also police, lawyers, your bank - to get sensitive personal information out of you. 

All genuine organisations, especially anyone offering to recover money you are owed, will not cold call as part of their code of practice. If you do have any organisation contact you out of the blue, ask for and check references, and never, ever pay anything up front. 

Image by Juanita Mulder from Pixabay