Power Up Wealth podcast – Episode 101 – Unmasking the Online Deception: A Heartbreaking Tale of Betrayal
James Derrick 0:00
Scams are becoming more sophisticated. I’m James Derrick, President of Smedley Financial and today, we will be talking with expert and guest, Parker Thompson. We’ll be sharing a shocking story of how one individual lost hundreds of 1000s of dollars.
Shane Thomas 0:18
Welcome to the SFS Power Up Wealth podcast where we provide impactful insight and expert opinions on timeless financial principles and timely investment topics, preparing you to make smarter decisions with your money.
James Derrick 0:34
Thank you for joining me today, Parker.
Parker Thompson 0:35
I appreciate you having me.
James Derrick 0:37
Parker is a private wealth manager at Smedley Financial Services. He has a Certified Financial Planning designation. And this fascinating story about a scam that’s actually very unfortunate. Parker, how did it happen?
Parker Thompson 0:48
It’s bittersweet. It’s both fascinating and shocking and unbelievable, but also it hits on some of the weakest points of us as humans, our human nature.
James Derrick 0:57
And we should say before you get started, that you have permission from this individual to share the story in order to help others.
Parker Thompson 1:05
Yes, this is, this is an individual that is a client of Smedley has given us permission to share this story. We’ve obviously changed the names here for privacy. He felt like it was important for everyone else to know that these kind of scams and these type of people are out there, and that everyone should know that they are and the tactics that they use.
James Derrick 1:22
All right. Well, with that, why don’t you jump in and tell us what happened?
Parker Thompson 1:25
We got brought in halfway through the story, but I’ll tell you this, this started even way back a couple years ago, when Bill lost his wife. So they had been married for many, many years. He lost his wife. This was his companion that he was going to retire with spend their days together. And so Bill started to get a little bit lonely. He felt like he needed someone to talk to, someone that he could converse with, someone that he could be in a relationship with. And so he had some, you know, people, that were reaching out online, and he decided to connect with one of them. We’re going to call her Melinda. So they connected online. They started talking on social media. They eventually took it to a what was thought to be a secure messaging app, and they were going back and forth on this app, and they were compatible. They loved each other. He had so much in common with her. They both were independent. They both were well off. She had owned businesses. She was over on the East Coast. That was the only downside. They just couldn’t get together. They kept talking about, we need to get together. I want to fly out to you. I want to go over there. He wasn’t going to go out to the East coast because she had some strenuous things that she was trying to wrap up with her business that she owned. She was kept She kept telling him, hey, I just need to wrap up a few things with my business. I need to wrap up a few legal issues. I really want to come and see you. I want to come live together. And they felt like this was important, that they were going to spend a lot of time in the near future, or if not the rest of their lives, together because they felt like they were so compatible. This kind of went on for months and months and months until finally, she was doing fine with business and all the legal issues were wrapping up, but she had come across an investment, an investment opportunity or an idea that she got roped into, and she thought it was the greatest thing ever, and she wanted to prove that she was loyal and prove that they were on the same team. So she said, Hey, why don’t you invest in this with me? I think this is a really good idea. It’s actually a very secure crypto exchange, and we’re going to be buying cryptocurrency together. And so I’ll put my money in, and you’ll put your money in, and that way we’ll be in it together, and not one of us is more at risk than the other. And so that’s what that’s what he said. He she sent him a link through the messaging app. He downloaded the app. The App looked sleek, everything looked fine, and then the way that they got the money was that he had to go to the bank and wire out a money to an account that was offshore, unbeknownst to him, but that had the same name as one of the reputable cryptocurrency exchanges in this in the US, slightly different, slightly different title of the company, but he he all thought it was it just looked legit. It all seemed like it was real. And so he kept doing this. And then the app would show him the returns. They were still communicating him, Bill and Melinda. They were both having all the same chats as they were before, but they were both watching their investments grow and grow and grow to the point where he thought, you know, I got to keep throwing more money into this. And so then comes the HELOC, the home equity loan, and he maxes that out. Then come the credit cards, then come his trust accounts and other assets that he has, and so much so that he had thrown in just over $200,000 of his own money into this account. Turns out that this girlfriend then moves to go see her family in Australia. This is her new her thing that she has to go see her family in Australia because her mom is sick. And then all of a sudden the hospital bills start to stack up. And then all of a sudden she doesn’t have money, and she can’t get money over to her international account. So then we need to help her out with buying groceries. And one thing comes after another, and all of a sudden he is trying to get money out of his crypto account because he has nothing left in his own accounts. He’s maxed out his credit cards. He’s maxed out his personal loans. He’s maxed out his HELOC. And then he goes to the customer service of this official cryptocurrency exchange, and they tell him that he can’t get it out, and if he does, he’s going to be put on a list with the IRS and the FBI as fraudulent because his money hasn’t vested long enough. And so he has the hardest time getting it out. And this is when he starts to reach out for his retirement accounts, his IRA. And this is where we get involved at Smedley. This is where we come into this picture, because he’s requesting money out of his retirement accounts, and he’s having a hard time doing that. And I had to sit down and have a really tough conversation about what was going on, and he wasn’t forthright with a lot of the information right at the beginning. Granted, it’s, it’s an embarrassing thing for him, right? And so I understand why he wasn’t. But this is when we stepped in, and this is when we started to say, no more money goes out to these people. This is all fake. The girlfriend was never a true girlfriend. This is someone else. The chats were all created and framed, and any video calls or phone calls were all fake. Could have been AI generated. There’s a number of things here. And so with all in all, all of the loans, all of the credit cards, all the money that he sent out and wired to international banks, over $200,000 and probably to this day, we’re still dealing with some of the issues with maxed out credit cards and interest rates. And that alone is probably put it probably over a quarter of a million dollars total.
James Derrick 5:58
That’s incredible. How much time went by, you know, from the time that they started chatting online until you got involved?
Parker Thompson 6:07
I would say he had let me know that they were talking for about six months or so before that. So I had reached out and contacted him, and he let me know that his wife had passed. And so we were involved with that process of moving his his wife’s money into his own IRA. It was about six months after that that that we met together, and because he was having issues with pulling that money out of his account, he was trying to figure out where else he could get money from. And he said he’d been talking to her for, you know, six months at that point.
James Derrick 6:33
It’s an incredible story and so sad. It’s interesting that he didn’t want to be forthright in explaining it. It’s almost like part of him knew that something was wrong.
Parker Thompson 6:46
He knew that there was something wrong. He knew that he couldn’t get the money out. He knew that there was something fishy about it. But he was so enveloped and so trusting of this girlfriend that he still thought that she was real. He thought that she was a separate entity from this cryptocurrency that was being fishy and not allowing his money. He still thought the relationship was real. He still still thought that she had his best interest at heart and that she wasn’t related at all.
James Derrick 7:10
I do see how that could be seen as two different scams going on, but it was one scam.
Parker Thompson 7:17
It was one scam, and they, and this is, this is what they do nowadays is they bring you into a whole storyline. They’ve got a timeline of things that they want to do in order to make it seem real for you. I don’t necessarily blame him for being not so forthright with all the information. It took me multiple meetings to figure out exactly what was going on and to finally have him come forward and say, Yes, I am giving money to her or to this cryptocurrency exchange. There’s a lot of shame in this, and there’s a lot of embarrassment in this. I wish that I could tell people that there wasn’t right. People should not feel shameful about this. This is so sophisticated, but there’s just a lot of taboo around it, and so it’s hard when you know that you’ve been bamboozled. You don’t necessarily want to tell people. You don’t really want to admit that that has happened to you.
James Derrick 7:58
Now was it hard to convince bill that this was a scam? Because I’ve heard stories like this, where people want so badly to believe that even if you intervene, they’re more likely to believe their friend online than they are to believe the friend in front of them.
Parker Thompson 8:15
There’s so many times and again, I don’t I don’t blame him for lying to my face, right? I don’t like I don’t put that against him at all, because I realized some of the pressures that he was under and that he was really in a hard spot in his life. He was sharing all of his information with this online girlfriend, and none of it with me, right? I had to really dig and pry and dig and pry, and I basically told him, if you can’t get your money out, or if, if she keeps doing these pattern things, and I would warn him if she asked you for this, if she talks about sick family member, or if she talks about her accounts being locked up like these are all red flags that she isn’t who she says she is, and she’s a part of this. She’s originally the person that sent him the link to then get the app to do the cryptocurrency. So these are not two separate entities. These are one organization or one person, one I don’t even want to venture to guess how many people are involved with this, but they are all working together.
James Derrick 9:03
Well, let’s take a step back, like you probably have, and look at the red flags that exist in both this story and in others that are similar. What red flags Do you see?
Parker Thompson 9:14
I’ll tell you one of the first ones is she reached out first online. People are not who they say they are online to. We have to take that for granted. We are so blessed nowadays to have social media. We are in such a technologically advanced age that we can connect with people from different countries and different continents, and your family members that are long lost. But if you don’t know that that person is who they say they are, you can’t take their word for it in a messaging app or in a in a social media app, you have to have met the person before is my advice, confirm that that is their account. People get fake accounts created all the time of their family members or their friends, and it’s just really hard to believe, even if it’s from someone that you know you’ve connected with as a friend or a family member, their account could have been hacked. Just don’t necessarily trust who everyone says they are online, because that’s not always the full picture.
James Derrick 10:02
And what advice do you have for people who find themselves in this situation or find a loved one in this situation? What do you do first? Do you call the police? Do you call the FBI?
Parker Thompson 10:10
I think the first thing you should do eventually, if things get really serious enough, you can contact authorities and get them involved, but initially, just to stop or at least get someone’s opinion on it, you need to contact someone. Contact someone you trust, someone you love. You need to be talking about it with people and getting different opinions, someone from the outside, son or a daughter or an uncle or a parent or a brother or sister, someone that can tell you, Hey, this is you’re wrapped into this world. And let me take you a step out. Let me see it from different pair of eyes. Let me, let me give you a different opinion on it. I think that we should first be talking to people that we trust, or in this case, outside of that, someone that is a professional that is involved in this world. So trust attorneys, CPAs, financial planners. Obviously, we’re here in this financial industry, especially if it’s starting to get your finances involved. It’s one thing to have a romance scam, but it’s typically their one goal is to get to the money. We are those people that are handling the money in most cases, or at least we are aware of people that are in these situations. You got to contact someone that is professional in this industry, that has seen it before, because we can look at it very objectively. We can look at it with different pairs of eyes as well too.
James Derrick 11:18
What other conclusions do you draw from this that could be helpful to people?
Parker Thompson 11:22
You see all the red flags in here, and you can, you can point out any that that it’s it’s so easy to see it out when we frame it like it’s a story of a scam. You can see the red flags, and they’re very apparent. We have to think about Bill, losing his wife and being kind of an emotional state where he doesn’t quite see clearly. Losing a loved one is tough, right? We’ve, we’ve all lost a loved one, and if we haven’t, it’s coming eventually. Those are very emotional times, and it’s very bad time to be making decisions. And a lot of times you have to make decisions during that time. That’s why it’s good to be talking with someone and to keep relationships up. I think that we could go over a plethora of things of you know, don’t necessarily talk to people online. If someone sends you a link to invest in crypto, that’s probably not a good idea, right. We’re not sure what crypto exchange is on if someone wants you to download an obscure app. Probably don’t do that if we are chatting with someone online or even video chatting. I hate to say this because we want to be a trusting species as humans, but AI nowadays can really mess with you. Ai, you can create video, AI can create video of people that don’t even exist. You can create conversations on the phone. You can create video chats. So it’s just really hard to trust that that person is who they say they are, and we have already hashed that over. But want to make sure that you know those are easy to spot from our perspective, but from from someone who’s just being led along and thinks that they’re talking to someone talking to someone real on the east coast, this is not always as easy to see, especially for someone who’s older and not in a technological generation.
James Derrick 12:50
I can see the benefit too, of just having rules that you’re going to follow, personally. I had a phone call just yesterday saying that a payment for the company didn’t go through, and we owed some money. And I said, well, that’s fine I’ll go online and take care of and they said, well, that would normally be okay, but because it’s past due, we need to take care of it right now. And so there’s this sense of urgency that they apply. And then she wanted to transfer me to somebody else to take the payment, and suddenly, like she’s trying to get me to go down this rabbit hole. But I was skeptical and decided that even if it was legit, I wasn’t going to do it like I would go online and make a payment if a payment was due online, and there was no way she would convince me to do it over the phone, even if she was real. I’m like, I’ll take that risk.
Parker Thompson 13:39
Yeah, the threats and the urgency can really get a lot of people to do this is what we most typically see is robocalls or calls to people that are just randomly placed that say there is something that’s hanging in the balance, a package that’s due, a payment that’s due, something malicious that’s happening, we need to act now. You need to do something now. We need to get credit card information now, or we need to do something now. In this case, a Bill was required to wire out to a certain bank and do it now, before this intro period was done, and then when he tried to get his money out, it was threatening him with IRS or authoritarian action by the FBI if he were to take the money out or request it, even to the point where, you know, no customer service in this entire country would ever give you death threats. But they started doing things like that to really get him to act and to put more money in so that he could save his account. Those things, the word that I keep coming back to is just how insidious it all is, to prey on his emotions and to get him in the position, and then to have to threaten him in such a way to get all of his money. Who knows if that would have been all of his money, he luckily, has still some to live on. But anyone who is asking for a certain amount of money or certain type of payment for you to wire money to an obscure international bank, and you have to do so by now or threat, we’d really want to be careful on those right. There’s just a certain pattern that these people follow. It pays to just ask someone. If he would have approached me before all the money got out, before the personal loans were taken out, before the HELOC was taken out, I would have been able to pick out from the wire instructions that it was going to Vietnam instead of anywhere in the US. There’s there’s easy things that we can see, but when you’re in that situation having the blinders on, it’s just harder to pick up on a lot of those things.
James Derrick 15:11
Parker, I really appreciate you coming in to talk about this, and my heart goes out to Bill and all those who are having a difficult time with the scam that you know, has already taken place, so we got to watch out.
Parker Thompson 15:20
It’s unfortunate that that I have to share the story, but I feel like it’s important for everyone to know and and during this holiday season, you know, we all like to watch the old show, The Grinch and the old cartoon and how he steals Christmas. I really, things are getting sophisticated nowadays. You got to have someone on your side. We got to make sure that these scams end or that they’re not affecting people, especially close to home. So hopefully, hopefully this helps someone out there to recognize some of these patterns and to and to act on it.
James Derrick 15:45
Thank you, Parker.
Parker Thompson 15:46
Thanks, James.
Shane Thomas 15:51
Thank you for joining the Power Up Wealth podcast. Smedley Financial is located at 102 S 200 E Ste 100 in Salt Lake City, UT 84111. Call us today at 800-748-4788. You can also find us on the web at Smedleyfinancial.com, Facebook, Instagram, Twitter, and LinkedIn. The views expressed are Smedley Financials and should not be construed directly or indirectly as an offer to buy or sell any securities or services mentioned herein. Investing is subject to risks, including loss of principal invested. Past performance is not a guarantee of future results. No strategy can assure a profit nor protect against loss. Please note that individual situations can vary. Therefore, the information should only be relied upon when coordinated with individual professional advice. Securities offered through Osaic Wealth, Inc., member FINRA/SIPC. Investment advisory services offered through Smedley Financial Services, Inc.® Osaic Wealth is separately owned, and other entities and/or marketing names, products, or services referenced here are independent of Osaic Wealth.
