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Fallout from Suncity Equities and Investments

Posted by Aegist on July 16th, 2008

It looks like another one of these Arbitrage investment schemes has disappeared with a lot of money that they didn’t own. There has been a long line of very upset people posting at ArbForum over the past few days because none of them are able to make any contact with Suncity Equities and Investments at all, and it looks like the company have simply closed up shop and disappeared.

It is worth drawing the attention of any new readers here to an article I published about 6 months ago: St Gallens Investments, Suncity Equities and Investments and other Arbitrage Investments AGAIN and the associated discussion on ArbForum at around the same time: Suncity Equities and Investments

Notice how the person I was directly replying to in my opening post of the ArbForum thread was impressed because Suncity had already paid out money requested? THIS IS NORMAL for a Ponzi scam. This should never be seen as evidence of legitimacy. That same article in which I first mentioned Suncity EI also mentions AFL Arbitrage Systems, the company publicly shamed into hiding by A Current Affair a couple of months ago. I don’t know anything for certain about any of the other companies mentioned in that article yet, but when we post warnings about not investing in companies of this nature, we aren’t making it up just for fun. It is clear that a lot of people have been really badly hurt by Suncity and by AFL Arbitrage systems – and I hate watching it happen.

So, to the next person who posts on ArbForum, or emails me directly about some ‘too good to be true’ arbitrage-like investment scheme which they want a second opinion on, this is my reply to you:

Maybe the company you are asking about is legitimate, maybe they have the most pure of intentions, but there is no way of really knowing. This industry has a shocking record, and any investment made with a company claiming to do anything like this, must be taken as an almost guaranteed loss in terms of risk – I don’t care if they say “No Risk” on their website, the very fact that they say that makes me even more certain they are a guaranteed loss. If someone you know has received payments already from this company, I don’t care – still considered a 99% risk of loss.

The only thing you can really use to make sure the company you are dealing with is legitimate, is to ensure their accountability – force them to take responsibility for whatever they do. A name and a phone number does not make someone accountable. Names can be lied about/faked, and phone numbers can be cut off. You want accurate licensing (appropriate to what they are doing!). You want a large, well known, highly visible company which can not disappear – this forces someone to take responsibility.

In short – my advice is don’t give them your money. You are far more likely to make money by putting it all on ’0′ at your local casino.

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