Watch out for cold calls from a Queensland-based outfit called OLM selling an “investment package”.
Kiwis are being asked if they have $10,000 to invest. The “package” turns out to be betting software for horse races in Melbourne and Sydney.
OLM cold called a Consumer researcher’s home and made numerous claims, including that the betting returns had been audited in Australia by accounting firm Deloitte. We checked with Deloitte Australia and were told: “we have not been able to find any evidence that OLM Pty Ltd is a client of ours”.
The software system costs AUD$8900 to buy and OLM claims that its customers have made $93,792.38 total profits in 7 months from a $1000 initial “investment”.
No consumer protection
Although claiming to be an “investment”, OLM’s offer doesn’t come under our investment laws and leaves consumers open to being ripped off. Liam Mason, head of Legal at the Financial Markets Authority says his organisation is unable to take action because software isn’t technically a “security” (that is, a type of investment). But he said “we would discourage New Zealanders from sending money to any company, where it is unclear what the precise offer is, what risks are entailed and how you might obtain redress if something goes wrong.”
Authorities on both sides of the Tasman, as well as the TAB, are warning consumers not to pay money to OLM-type schemes.
Alastair Stewart, communications advisor at the Ministry of Consumer Affairs, says investment scam software will not work as promised and consumers will not get their money back. “Computerised gambling systems promise to predict results accurately, for horse races, sports events and even share markets. While there are legitimate software packages to monitor investment variables, the scammers make exaggerated claims by making empty guarantees that you'll be able to make money through betting.”
This message is echoed by the Australian Competition & Consumer Commission, which has warnings about sport investment schemes on its website scamwatch.gov.au. It told us the promoters of these schemes can be persistent, which is exactly what happened to our researcher. When asked for some time to “think about it”, OLM’s salesman claimed that there were only 4 licences left in the Auckland area – a classic hard-sell technique.
- This offer has all the hallmarks of a scam.
- It involves gambling, not investment.
- If OLM really offered the returns suggested, the company directors would have no need to tout for business on this side of the Tasman.
- Your chances of recovering money paid to an Australian-based company are slight.
More from consumer.org.nz
- Scams - our guide to protecting yourself