The caller was from a New York-based firm called Harris James Associates. He was contacting me about my shares in Watford Leisure plc: would I be interested in selling them? He said his firm is representing a multinational company that wants to buy a majority stake (ie 51%) in Watford Leisure, on account of its “special assets and licences”. Later he also said that the deal was tax-related.
He claimed that 43% of the company’s institutional shareholders have already made a commitment to sell their shares, and wanted to know if I would do the same. The price would be between £8 and £17 a share, to be paid 30-90 days after the transaction was completed. There would be a requirement to lodge a bond as insurance against the deal falling through, but the “good news” was that the purchaser would pay most of that, and I would only be required to contribute a small amount.
Finally, he asked for my email address so that he could send me a confidentiality agreement that I would have to sign before proceeding any further with the transaction.
Now obviously I have no intention of going along with this scheme. As the old saying goes, if something sounds too good to be true, it probably is. Watford Leisure plc shares are currently trading at 5p each, and their peak value in the past 12 months was 11.25p. So why would anyone possibly want to pay £8 each for them? It would have to be one hell of a tax dodge.
So, assuming it is simply a scam, how does it work? My initial thought was that it might be something to do with the bond that was mentioned, with the “small amount” eventually turning out to be a significant sum. That would fit the pattern of other well-known scams, such as the “You have won the [name of country] lottery” con, where you’re asked to send a fee to an intermediary, who will then pass on your winnings to you.
Alternatively, maybe it’s as simple as harvesting bank details. They already have my name and phone number, and presumably my home address as well; if I gave them the details of my bank account, they could wreak all kinds of havoc.
If anyone reading this has any other ideas, do post a comment below. I’m intrigued to know exactly what’s going on here.
1 comment:
Tim, I had exactly the same speil before Christmas, but they used a different name (IDA Consultancy). I asked for the Confidentality Agreement and it didn't ask for bank details, just contact details so I agree, they seem to think they can play a long game and get away with it by appearing legit. I spoke with a woman called Jessie Seeber. They kept on phoning and after the publcity about the scam I just said I didn't want to pursue it and the phone was put down on me. During the process they said they'd confirm how many shares I had and got it wrong, so bang wernt their credibility!
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