The latest cold-calling scam
This week, Tony Levene investigates the latest cold-calling scam coming to a telephone near you...
Writing about carbon trading and credit schemes is always dangerous. There's a section of the population whose internet antennae are permanently on alert for the word “carbon”. Then they bombard any site mentioning carbon that allows readers to comment (as lovemoney.com does) with their generally very lengthy, and often very aggressive views, on global warming. And surprise, surprise, they are all climate change deniers.
I should know. For whenever I write about carbon credit schemes, I get exactly that response. I suspect that I would get worse if lovemoney.com readers and other site moderators did not report the most extreme and most insulting.
Carbon credit trading
So let's start this piece with a personal statement. I don't care whether you think global warming is a reality to be avoided at all costs or an international conspiracy orchestrated by the Bilderberg Group in conjunction with Goldman Sachs and that “trader guy” on BBC news. All I'm interested in is firms which cold-call anyone they think has money that they can be parted from.
There are now literally scores of these companies out there – all with a very similar patter to convince potential investors that they will make big money quickly out of carbon credit trading.
Now I'll let you into a secret. If there was a scheme to make big money quickly, then all those hedge funds, assorted traders, and investment banks would have been there first. If the market is, as the cold callers say, worth billions or even trillions, how come the big boys are leaving anything either for small investors or for the firms who phone you uninvited (telephone preference service? Forget it, these guys always claim you've filled in a marketing enquiry anything up to a year ago).
The firm that called me, promising me the fast track to wealth, had literally only been established as a company the day before. That's fast! It sent me a brochure which was so full of how you could greedily cash in on carbon while the rest of the world was going to drown under the melted polar caps that it was enough to make me into a global warming denier.
The script salespeople from these companies use is designed to press every green button going – perhaps telling them you're with former Fox News presenter Glenn Beck on this might either slow them down or change their patter. Beck calls “global warming” a “global scam”.
Be on your guard
This is not the first time I've warned about carbon credit schemes – I've been going on about them for a year or so. But here's two amazing facts about them, from my scambusting friends at the Financial Services Authority.
First, while firms springing up out of nowhere claiming an expertise in carbon credits are nothing new, their numbers have soared since June with around twenty to thirty reported each month. That's a plague.
And now for an even more amazing fact. The FSA says large numbers of these firms have switched almost overnight from landbanking or have personnel who were formerly landbankers. The guy who called me up last week told me – to boost his credibility – that he had been a “land expert” but had realised that carbon was the place to be.
The skills needed to sell dodgy land and dodgy carbon credits are much the same. You have to appeal both to rationality (land with residential planning permission is worth more and people need houses turns into your grandchilden will live a better life if the world is free of carbon pollution) and to “masked” greed (as in your present investments are not doing well so, if you love your family, here's something to make money).
Next week, I'll delve further into the world of carbon credit schemes, including a close look at some of their website small print.
In the meantime, read the FSA warning on carbon credits and keep the cold callers out of your bank accounts.