Documente Academic
Documente Profesional
Documente Cultură
BY YITZCHOK KORNBLUH
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17 Iyar 5776
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agement fees and a variety of sundry costs are deducted
from the rental income.
In the second quarter there are additional expenses
such as repairs, etc., which once again are deducted from
the rental income.
The third quarters income may be stalled with explanations that the tenant did not pay his rent, and in the
fourth quarter the principals request extra equity or
they deduct the sum from either your income or from the
invested capital, with the excuse that as the market value
has fallen, the banks wish to reduce their borrowing and
insist on additional cash.
And so the story continues throughout the life of the
investment, quarter after quarter, until either the mortgagees repossess the property or the company goes into
receivership. In short, you will never, ever, see your capital
back, nor will you receive much in the way of income as a
return.
Another Scam?
Another scam involves private investors lining up to
nance the purchase of a property with the promise that
once the property has been purchased, a mortgage will
redeem the investors cash. This, of course, never materializes. The question to ask as a potential investor is: If
the deal is potentially so lucrative, why would an operator
require funds from private individuals?
The answer lies in a rather cynical plan in which private
investors are prospected with promises of high returns
when nancial institutions have rejected the funding due
to high risk factors. One has to ask oneself: If a bank does
not feel comfortable to secure a loan on such project, why
should I?
Some schemes operate by luring unsuspecting investors into their trap through total misrepresentation. The
list of their devious behaviors is endless, and it is up to the
shrewd investor to seek and pick a genuine opportunity
and not be foiled by the scammers. What is most puzzling
is that when you ask an investor why he has put his money
into these schemes, the answer will often be, I only have a
small sum and I cant do anything with it on my own. One
has to question this theory as to why a person might want
to throw away good money for this reason. This is effectively what someone is doing by investing in highly volatile unsecured multi-partnered property deals.
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True Stories
No Get-Rich-Quick Shortcuts
There are no shortcuts in creating wealth; anything that sounds too
good to be true ought to be avoided. You cannot change your destination overnight, but you can change your direction. Therefore, you need
to design your own plan; otherwise, you will be falling into someone
elses plan. That is a recipe for nancial disaster, as their plans dont
take into account your nancial interests. Economic disaster begins
with a philosophy of doing less and wanting more.
I once heard from a great motivational intellectual at a seminar that
To be successful, you dont need to do extraordinary things; you just
need to do ordinary things extraordinarily well. What a powerful piece
of advice!
Victim Feedback
Since bringing these scams into the public eye, I have been
approached by many victims who fell prey to promised get-rich-quick
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Yitzchok Kornbluh is an advocate and paralegal consultant based in Stamford Hill, London. He can be contacted by email on imagintern@gmail.com
17 Iyar 5776