Kiwi pours 500k into alleged scam: 'I'm not a Dumbbell'

NZ Herald,
Publish Date
Tue, 19 Jun 2018, 9:37AM

Kiwi pours 500k into alleged scam: 'I'm not a Dumbbell'

NZ Herald,
Publish Date
Tue, 19 Jun 2018, 9:37AM

A Kiwi man has poured $525,000 into what is believed to be a sophisticated global investment scam and is warning others against being taken in.

Authorities are looking into the apparent ruse which has allegedly duped other Kiwis out of their life-savings.

Manfred Bredl, 63, believed he was investing in a groundbreaking carbon emissions scheme, reportedly backed by the Mexican government.

But promises of a NZ$1.8 million cash windfall by charismatic, smooth-talking operators failed to materialise and Bredl now fears he's lost the lot in a sophisticated con.

He believes he's been duped by individuals behind two dummy companies – FM Wealth Management Ltd, purportedly based in the Cayman Islands, and private share company Eco-Plant Corporation.

Bredl claims they masterminded sham social media accounts and company newsletters, and even alleges fake photographs of company directors on the website.

"I'm university educated, I'm not a dumbbell, but they were so good at disguising what was a very smart sales pitch. It was very sophisticated," said Bredl, a Lower Hutt telecommunications engineer.

Manfred Bredl fears he's lost his money in a sophisticated global con. Photo / Marty Melville
Manfred Bredl fears he's lost his money in a sophisticated global con. Photo / Marty Melville

Bredl has lodged complaints with New Zealand police. He said he was aware of three other alleged FM Wealth Management victims.

In correspondence seen by the Herald, police say Bredl's complaint will be assessed before deciding whether an inquiry will be launched.

But one police staff member said Bredl shouldn't get his hopes up: "As I am sure you are aware there is little hope that we as the NZ police can recover any funds for you given it is outside of our jurisdiction. We can, however, forward a relevant file overseas through Interpol if the investigator deems it."

The Cayman Islands Monetary Authority has blacklisted FM Wealth Management and, in December, New Zealand's Financial Markets Authority (FMA) issued a warning for Kiwi investors to steer clear of the company.

"We have received reports that representatives of Fitch Matthews Wealth Management are cold calling and offering investment opportunities to New Zealand residents. Fitch Matthews Wealth Management is not registered on the Financial Service Providers Register (FSPR) therefore is not permitted to provide financial services to New Zealand residents," it said.

The companies, which reportedly have offices in Cayman Islands, Toronto, and Buenos Aires, did not respond to phone calls or emails from the Herald.

Bredl was first cold-called by FM Wealth Management Ltd last April after researching investment possibilities online.

The caller explained how they worked and said there had been rumours that a pharmaceutical company, which had patented a successful leukaemia drug, was about to be bought up by a bigger company and that its shares were on the rise. He suggested making a small investment to test the waters.

Bredl was intrigued and snapped up 500 shares at a total cost of USD$1136.25. The money was wired to a bank in Toronto.

Within weeks, Bredl saw share prices increase.

About a month later, FM Wealth Management's "co-owner" Bruce Matthews phoned Bredl. Matthews, a "very smart, charismatic guy who could've been a preacher", said they had just been given the contract to take a private share company, Eco-Plant Corporation, through the process of being publicly listed.

The CO2 recovery and transformation technology company, Matthews told Bredl, had patented technology developed with the cooperation of the governments of Mexico and Chile. It also reportedly had several prototype facilities in Mexico and Santiago.

Matthews allegedly explained the company was raising capital by selling shares for US$4 and once publicly listed, shares would be anything between US$8 and US$12.

He also allegedly mentioned that there might be the possibility to buy share options at US$4 even after the shares are floated, with a restriction that they can't be sold within a certain period.

"I thought that's a bit funny but I suppose by that stage I was getting a bit greedy," Bredl said. "They said the deal would be done by Christmas (2017) and I would have the money."

Bredl was convinced to buy large share bundles and eventually plunged in NZ$525,000, even re-mortgaging his home to raise the capital. The money was wired through bank transfers to various Canadian and Mexican banks.

The returns for Bredl, on shares he bought for US$4, minus the company's commission, would've amounted to $1.8m.

"I was an idiot," Bredl told the Herald.

"In hindsight, I can see it was absolutely stupid – nobody gives you that much money in a hurry. But with it being leading-edge technology, and carbon credits, it looked like a good opportunity.

"At the same time, I lost my job, and a big chunk of my redundancy money went in there as well."

He was due to get his investment payout late last year. Then, the company said there were delays. Then communications started to dry up. Bredl began to get nervous.

Now, he doubts he'll ever see his money again.

"I'm not holding my breath."

A Herald investigations last week revealed that Kiwis are losing up to $500 million annually to international scammers and the number of reported incidents has risen sharply this year.

Bronwyn Groot from Commission for Financial Capability. Photo / Focus
Bronwyn Groot from Commission for Financial Capability. Photo / Focus

Bronwyn Groot, fraud education manager at the Commission for Financial Capability, said Kiwis need to be wary of cold callers.

"Almost every day, people contact me saying they have lost money through investments scams and sadly, $500,000 is small," she said.

Fake photos and wordy newsletters that strung investors along were commonplace, Groot said, in what were becoming increasingly sophisticated swindles.

"The callers are super good at what they do. They might ring back two or three times and then convince people to make a small investment, usually around US$3000 and that's how it starts. You're never sent any share documents, only ever the website log-ins where you see the shares go up and down. But when you try and get your money out, that's the problem.

"The victims always say the callers were so nice, 'They were going to come out and have a beer with me and stay with my family'. You hear that consistently. That's the level of trust they can get with these guys."

Instead of wondering, 'What can I win?' Groot suggests people should think, 'What can I lose?'

Internet safety group Netsafe said New Zealanders should be "extremely wary of any unexpected investment offers" and always deal with companies that are authorised to operate in New Zealand.

"Scammer tactics are becoming increasingly sophisticated and investment scammers may use professional-looking marketing materials to make the offer appear more legitimate," a spokeswoman said.

She urged New Zealanders to check the FSPR but cautioned that it is not an official approval of an individual, business, or organisation.