Superfood: Soaking the middle-classes
Credit card scams which seek to take advantage of the lifestyle aspiration of Britain's more affluent consumers are a growing threat. More than 250 online suppliers were shut down last year after customers complained of trickery
The health-conscious middle classes are suckers for the latest superfood, especially one that promises everything from weight loss to improved brain function. But a craze for Brazilian acai berries has left a bitter aftertaste for tens of thousands of people conned in an online scam.
Twenty-seven companies mis-selling health supplements have been shut down in the High Court after an investigation by the Insolvency Service, which found that seven of the companies fleeced consumers out of a total of £12m. And this was only the latest in a series of schemes aimed at soaking the middle classes.
Customers responding to internet pop-ups were offered free trials of products such as Acai Berry Detox, Absolute Acai and Life Cleanse. But after giving their credit card details to pay a modest £3.99 for postage, they found that about £80 a month was being deducted from their accounts. Some then found it nearly impossible to cancel the orders.
The grape-like acai berry has become increasingly popular in recent years after being marketed as a weight-loss tool.
Similar scams have operated across America: in August a court in the US froze the assets of a company selling acai products in a scam thought to be worth $100m (£65m).
Sales of the berry, which has a tart, slightly chocolatey flavour, have also been boosted by celebrity endorsements from the actors Kate Hudson and Matthew McConaughey, and the American professional surfer Kelly Slater. However, some endorsements have proved to be false, and talk-show host Oprah Winfrey recently took legal action against firms which claimed she had recommended their products.
The acai companies shut down in the UK were registered to addresses in the County Durham area but also traded internationally, with offices in other places, including Barcelona and Malta. Twenty-five were found to be connected and under the control of Local Billing Solutions Limited, a company registered in Malta, while many were fronted by directors who knew nothing about their supposed companies. Criminal prosecutions may follow the winding-down of the companies.
The acai scam is only one of many targeting middle-class victims whose disposable income, desire to follow trends, and enthusiasm for a bargain make them easy prey for conmen offering everything from timeshares to too-good-to-be-true job offers.
"While the nature of scams change, what hasn't changed is that people are still the weakest link," said Sarah Kidner, editor of Which? Computing. "The word 'free' is always going to be attractive, but if someone came up to you on the Tube and asked for your bank details you'd never give
them to them. If it's by email then you think it is legitimate."
Consumers are susceptible to scams outside the internet too, however. Other companies have been criticised for targeting stay-at-home mothers and house-bound people with promises that they can "earn up to £1,000 a month working from home", if they stump up hundreds of pounds of agency fees. Many have claimed that they were given no work after joining.
"I think that they know exactly how to pitch the offer to appeal to the average stay-at-home mum," said Justine Roberts, co-founder of the website Mumsnet. "Luckily, most of our mums are quite cynical and savvy, but there are periodic postings when people report these scams. They are obviously widespread."
More than 250 companies were shut down last year as a result of investigations by the Insolvency Service, which received about 6,000 complaints from consumers. The Office of Fair Trading reports that scams cost the UK about £3.5bn a year, comfortably-off pensioners losing twice as much money as young people. An Age UK campaign this summer warned elderly people that they are prime targets for holiday scams.
While cons involving timeshare holidays have been running for decades, an increase in consumer protection means that these have been superseded by "holiday club" scams in recent years. These promise to consumers who pay hefty joining fees heavily discounted luxury holidays, which often fail to materialise.
Property sting: 'I paid company after company'
Paul Hedley, 65, retired biochemist, from Glasgow
"We had bought a timeshare in Gran Canaria for several thousand pounds. When we tried to get rid of it, the company we'd bought it from said that we had to pay them £2,000 and they'd find a buyer. We paid that, then I got a phone call from another company that said it was worth £9,000 but we'd have to pay them £900 to sell it. I paid it, as it sounded reasonable. I was contacted by another company, who said the same thing and were asking for more money. It went on and on with other companies, but I got the impression they were competing for a valuable market. I tried to get the money – about £4,500 in total on top of the original investment – back from my credit card company, but they said I wasn't covered. I'm a pensioner, and this has caused a lot of strain. We're now in a debt management scheme as a result."
Internet scam: 'They took £50 from my bank'
Cory Rawls, 38, actor and writer, from Walthamstow, east London
"A pop-up window on a website came up offering a free trial of a tooth-whitening product. I had to fill out an online application and give them my bank details to pay for postage, which was about £12. I cancelled the order straightaway, but then a few days later they took about £50 from my bank account. I called up to complain and was on hold for ages, then kept having to call different people. Even when I finally managed to cancel it, they didn't refund it and I had to keep chasing them."
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