sarah reasoner grey

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Dear Sarah

2017-02-18
By: sarah reasoner grey
Posted in: Advice
Dear Sarah,

 

My sister Jane is on Army PTSD disability. Recently our father died and left us a little money, and now Jane now has gotten herself involved in what I believe to be a scam. She called me yesterday to confess this to me, and said that she has known these people for quite some time. She has already given these people $ 38,000 from her small inheritance and has not told her husband about this. She never contacted her lawyer either. These people claim they will teach her how to find investors for house flipping, and offer her support by giving her names and phone numbers to contact. She says she will get it back and more when the deals are done. Isn't this just a come on to bilk people out of their money? Why would they need to get her money if they have investor names already? I try to understand it but it doesn't make any sense to me. I think I should get more information about this group, and even her financial advisor told her not to do it. This is not the first time she has done this but it is the most expensive time. It is as if she needs to spend large amounts of money to prove to others that she afford it. It is very complicated and I wonder if there is a name for this behavior. Should I risk asking her for more contact information on these people, I do not want to upset her but still, it seems like she just gave it away. I hate the fact that she may have been taken advantage of, it breaks my heart.

 

Signed,

 

Linda in Mass.

 

-------------------------------

Dear Linda,

 

It sounds fishy, but maybe it is legitimate. Asking her for more information is a good idea if done in the context of a conversation. Don't accuse her or this group that she is involved with without proof.

That she has not told her husband about this investment is not exactly being candid about how she spends her money. There are all kinds of infidelities in partnerships, this smacks of financial infidelity.

I hope you will be able to find out more about this group. If it is a scam, her money is probably lost. So sorry, but this is risky behavior. It also sounds like your sister Jane has a problem with handling money in general, from what you have said. If this turns out to be a scam I would consider looking into a mental health program for her. If she is willing to go that would be helpful. What a pity she did not consult a lawyer before she made this 'investment'. Hope for the best and be prepared for the worst.

 

Spikegary
link 02/22/17 12:15:56PM @spikegary:

I think the axiom, 'if it sounds too good to be true, it probably is', fits tis situation.

Flipping houses can be done, but you have to clean up the house, get it within code or could be on the hook for huge damages awards down the road.  Real Estate investment is always tricky.  Best left to the professionals.......

 

Roy_Patterson/we-talk-news
link 02/20/17 10:44:13PM @roy-patterson-we-talk-news:

My brother use to be in that business. This is a total scam. What kind of house are going to buy for $38,000??? If if you find a house at that price, and I bet you can't, where is the money going to come from to fix it up??? 

Dean Moriarty
link 02/19/17 01:36:52PM @dean-moriarty:

A fool and his money are easily parted. Easy come easy go. Hopefully she learns a lesson from her foolishness. 

Randy
link 02/18/17 05:54:56PM @randy:

It is a horrible and heartless scam. If it were on the up and up the list of investors and what properties that were invested in would be available to all. Call the police ASAP.

sarah reasoner grey
link 02/19/17 01:14:46AM @sarah-reasoner-grey:

I sincerely hope you are wrong here. Do you have knowledge of such a scam?

Randy
link 02/19/17 09:03:30PM @randy:

It sounds like a variation of a classic Pyramid Scheme. Invest money and you are supposed to get much more money back. The problem is that only the original investors and some of the first ones in get money because the only way the scheme makes money is by getting new investors and it pays the first investors out of that money. The first investors are pleased with their return on their investment, so they get their friends and relatives to invest too. Of course these schemes don't work because in order for anyone below the first few levels to get any money back then sooner or later every person on Earth would have to invest. The Pyramid always collapses and most of the investors are ripped off. That's why most of them are illegal. They are mathematically impossible to make money at unless you are one of the first ones. This is why Bernie Madoff is in prison. There are some legal ones that use a product or products to do the same thing. Amway is a classic example of the same kind of Pyramid Scheme scam, except it's legal. The only products ever sold by the company are the ones sold to new Amway sales people to get them started that other Amway sales people have recruited. The only way an Amway sales person makes money is the fee they get from recruiting others to become sales people. That's how Richard DeVos and Jay Van Andel became billionaires. They started the Amway Pyramid Scheme.

Buzz of the Orient
link 02/27/17 11:21:34PM @buzz-of-the-orient:

There is a lesson in the fact that Bernie Madoff was so smart and easy to believe that so many institutions and individuals fell for his scheme, but then there's a sucker born every minute.

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