Tuesday, September 7, 2010

Dear Graham, I have received a notification from facebook that I have won $3 million on their lottery and they want to give me a certificate so that I can claim the prize. I have been contacted by an English barrister who has offered to act on my behalf by getting the approval from the UK High Court to have the certificate notarised. The barrister is asking that I send $815 to him by Western Union so that he can proceed. Is this a ‘phishing’ scam?

Absolutely. facebook is a social networking site and does not have a lottery. Organisations do not give away millions because they pulled your name out of a hat.

Someone would need to put the name in the hat in the first place and with lotteries, that would be you and it would cost you a fee. You also sent us a copy of the certificate and the letter explaining the procedure.

All rather interesting except that the spell checker they are using is not working.

Out of curiosity, I rang their UK number and it came as no surprise to discover it does not exist. If you send them the money by Western Union, you have no way of tracking it as it will be picked up as cash. This is a variation on an old scam and no doubt someone somewhere will get ripped off.

I’ve been saving my money overseas for some time now and I have decided that it is about time I bought some investment property. As my money is in dirhams, effectively US dollars, I have come to the conclusion that London would make a lot of sense as the exchange rate is in my favour and they will be hosting the Olympic games there in 2012. I recently attended a property show selling off-plan London investment property that is well within my budget. My concern is that they require a 20 per cent deposit and having seen what has happened locally with deposits and non-completions, how safe is my money?

Your logic on location can hardly be argued with. As for the security of your money, in the UK it is legally required that ten per cent of your money must be returned if the building does not complete.

We looked at these projects and this developer has actually gone the extra mile and is providing assurance that all the 20 per cent deposit is safe. If the money is returned to you through non-completion of the project, it is will be done so through a premium. It is unlikely that these London projects will not complete because if the developer goes bust, there are plenty more willing to take the project over.

Furthermore, you can’t really compare what happened locally with the UK. Local contracts have given developers massive amounts of flexibility for extending completion dates and building specifi-cation changes.

The UK contract will have a specific completion date.

You also mentioned that the exchange rate has made this attractive for you. If the project finishes within two years, you can actually fix the exchange rate at its current rate for the balance payment on completion by using a specialist money transfer firm.

Graham Wolverson is an independent financial adviser with Pinnacle Asset and Wealth Management.
Email: graham@yourmoney-matters.com