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Consumer Alert: Beware of investment scams

Beware of anyone trying to sell you investments over the phone. Consumers lost hundreds of thousand of dollars falling prey to a get rich quick pitch.

A company lured investors to give more than half a million dollars to a home maintenance business.

"This company told victims that one day it would be larger than Home Depot," said U.S. Postal Inspector Al Herzog. "They would sign a contract with you and promise to do all of your home maintenance throughout the year. That would include raking the leaves, shoveling your driveway, washing your window."

The company used lies and half-truths to hook investors.

"Some of the things people were promised was doing incredibly well financially, when in fact, the company was losing money on a daily basis," said Herzog.

The company eventually went out of business.

"So when investors went to get their money back, there was nothing left to give them," said Herzog.

Victims were sent stock certificates in the mail that were worthless. They had never been registered with the Securities and Exchange Commission.

Inspectors say it's important for consumers to do their homework.

"In this case, if they would have done Internet research on one of the defendants, they would have learned that he served a prison sentence in the 1990's for doing the exact same thing," said Herzog.

Both defendants in the case were sentenced to federal prison and required to pay a combined restitution of almost $2 million.


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