Hi Barefoot,
My dad, who’s 60 and nearing retirement, got a call from an Aussie company pitching an SMSF to trade daily using AI (red flag – he didn’t contact them first). They claim to use only 2% of your super per day to avoid “losing everything”. He’s already invested $500 and says he’s made $25 but is being hounded by daily calls. When I asked, “what would the Barefoot Investor say?” he admitted it’s probably a bad idea, but he seems hooked by the promises. Please give him a call to help me convince him – his number is (deleted).
Kate
Hi Kate
Well, I called your Dad, and he’s a ripper of a bloke!
Now, I didn’t have a lot of time, so here’s what I said:
“I’ve never heard of these guys, but they sound like a bunch of crooks. And if you transfer your super they’re probably going to steal it.”
Unfortunately your father was a little unsure about what specific forms he’d signed to set up his SMSF, so I advised him to call his existing fund and make sure they would not allow the transfer out.
He agreed.
Then I hung up and called the Assistant Federal Treasurer.
Yet he was too important to take my call, so I spoke to one of his underlings.
Now, I didn’t have a lot of time, so here’s what I said:
“Let’s say you and I are having a coffee down the street when a bloke in a balaclava walks into the cafe and yells ‘give me all the money in your till!’. What would we do?”
“We’d call the cops!” I said, answering my own question. “And they’d be there in a flash. And they’d arrest him and throw him in jail.”
“However, when a decent, hardworking bloke is about to get robbed of his entire life savings with a pen rather than a gun, the only thing the authorities can offer is the wet-lettuce-leaf response of ‘Report it to Scamwatch’.”
Silence.
“Well”, said the political minion, without a lot of conviction, “you could ring ASIC and report it, and also … ummm, maybe … the Federal Police?”
So I did that as well. Still, there weren’t sirens, stun-guns and handcuffs on offer … it had more of a cat-stuck-up-a-tree feel to it.
Thankfully, your father is okay. He dodged a bullet that is currently being aimed at thousands of naive investors.
–Scott.