A Toronto-area pastor was arrested last week, along with his wife and the bookeeper for his church, for allegedly scamming $8.6-million dollars from members of his congregation.

Marlon Hibbert, his wife (who’s also a pastor) Verna Michelle Hibbert and the church’s administrative clerk, Lorraine Bahlmann, face 38 counts of fraud over $5,000.

It took just over 6-months for the arrests to take place after the Ontario Securities Commission ruled in September 2012 that the 3 were guilty of securities fraud.

Here’s how the fraud worked…

• Hibbert allegedly told potential investors that he was successful in trading in foreign exchange.
• Investors gave a minimum of $10,000 to be invested in the foreign exchange with a promise of a 79.4% return in each year.
• Hibbert provided monthly statements to investors to show that the principle they invested was growing.
• When investors wanted to cash out, Hibbert and his team gave a litany of excuses as to why they could not receive their principle or the surplus.

According to the report filed by the Ontario Securities Commission, the fraud took place “over at least a four and one-half year period between January 2006 and May 2010” with as many as 200 investor being scammed.

Tune up your money scam radar…

Whether it’s a pastor at a church, a guy on Kijiji or a Nigerian masquerading as an event planner, you’ve got to be vigilant when it comes to where you invest your money.

Anyone can become a victim of a money scam. ANYONE. You are not immune. Trying to stay on top of each and every scam is ridiculous. You cannot think like a criminal or thief and you just don’t have enough time in the day to do that.

Instead, you need to understand the common characteristics of a scam because they all follow the same modus operandi (MO).

Anyone that promises an 80% return in 12-months is lying…

In Proverbs 21:5, it states that those who want profit too quickly become poor. And anyone who promises an 80% return in a year is already giving you clues that they’re operating a scam.

I once heard a financial planner say that if you invest in stocks, you’ll get a 10% return…over 10-years. If investing in stocks gives you an average rate of return equivalent to what you return in tithes, what makes anyone think that a pastor at a little ol’ church who has NO EVIDENCE OF SUCCESS IN SECURITIES can beat the stock market with an 80% return?

Completely and utterly ridiculous.

Check to see if your financial planner is licensed, certified or registered…

Anyone who is going to invest or trade other people’s money in securities, capital markets, foreign exchange, commodities or stocks, or are going to provide advice on wealth management, taxes, needs to be registered with a national, provincial or state body.

This article in Forbes does a good job explaining the various financial advisers you can hire and how to ensure that you’re working with a legitimate planner.

A word about money coaches…

I’m one, but I would NEVER give advice on how to grow your money using stocks, bonds, derivatives, real estate or securities. If that’s how you want to grow your money, I can recommend a few good people in my network who are certified, licensed and credentialed in that area.

As a money coach, I work on the mindset and habits around money. I use a method that helps make money fun again. So many see money as something that’s evil and this thinking shows up in how we handle money.

Before you can think about investing, you have to clean up your view of money. So, in essence, I prepare you for that next step by helping you transform your relationship with money.

Most money coaches do the same thing.

 

Make sure that when you work with a money or financial coach that you’re clear about what he or she should be advising you on. It’s okay to work on mindset and habits with a money coach, but it’s not okay for a money coach to advise you on investments if they’re not licensed to do so.

This is the one thing that gets my hair in knots…

I hate to see people being scammed of their hard-earned cash by crooks and criminals. I hate it. I get all Mike Holmes on this issue. And sadly, many don’t take money scams seriously because they think it can only happen to old people who can’t say no to the scammer over the phone.

It can happen to any of us. And sadly, we’ll fall victim to the person whom we’re supposed to trust and in the environment that’s supposed to keep us safe.

What say you?

What are your thoughts on this issue? Were you the victim of this or another money scam? What other tips would you give so we can avoid becoming the victim of a money scam? Share below.