Advisor warns of possible poker scam

(June 20, 2003) Maybe it was just a friendly poker game, but an Oakville, Ont.-based advisor doesn’t think so. He wants to warn others about a potential scam aimed directly at the financial advice community.

Tim Niblett, president of Strategic Financial Planners, received a call last week from a potential client claiming to have $700,000 US to invest. The man, who said he was referred to Niblett by a friend, indicated that he was moving back to Canada after spending 10 years in Texas.

A meeting was arranged at a local hotel. When Niblett arrived at the hotel room, he found a poker game in full swing. “It certainly didn’t seem like your typical business meeting, but a million dollars-plus Canadian can make for a bit of flexibility,” Niblett admits.

The prospect left to get coffee and Niblett sat in for him at the poker table, staying in for a few hands. When the man returned, Niblett tried to steer the conversation toward investing, with little luck.

After losing $50, Niblett bowed out. The game suddenly ended, he says, with the players all indicating they had somewhere else to go, including the prospect, who said he was heading for Montreal.

“Although this sounds like a tame version of a Sopranos episode, I’m firmly convinced that this was a scam with the intention of me playing much longer in a rigged poker game,” Niblett wrote in an e-mail to Advisor.ca.

“I feel that they probably have a few advisors in a day under the ruse of potential business, fleece them, and then move on to the next location. Awareness of this for others could save them from getting trapped.”

The prospect called later in the week to say didn’t want to do business with Niblett. “I told him ‘that’s fine, I don’t have any interest in seeing you ever again,'” Niblett said in an interview.

So was the advisor a target of poker-playing con artists? Hard to say, according to Detective Staff Sergeant Barry Elliott of the Ontario Provincial Police, a specialist in scams and founder of the force’s PhoneBusters program.

“It sounds kind of funny,” Elliott told Advisor.ca. “But it could have been a legitimate game. And I don’t know if the police can do anything, because he’s not a victim.”

Although gambling scams are fairly common, an Internet check revealed no similar schemes specifically targeting advisors. “I’ve never heard of it — if it is a scam, it’s a new one on me,” Elliott says.

Niblett stands by his claim that something about the poker game “just wasn’t right.”

“I initially thought he [the prospect] was just plain quirky,” he says, “But after letting it all sink in, there’s no way in the world it was on the level.”

Although pleased that no similar episodes have been reported, Niblett says he hopes that also means that no similar episodes have actually happened.

If someone in the same situation lost more than just $50, “they’d probably not be too excited to spread the word,” Niblell points out.

Niblett says he has informed his dealer, FundTrade, about the potential scam, and expects them to pass along the information to others in the industry.

“We don’t think about this stuff often enough,” he concludes. “It never hurts to take a second look.”

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What do you think? Was Niblett a scam target or was this nothing more than a friendly card game? Have you ever been involved in a similar situation? Share your thoughts in Advisor.ca’s Talvest Town Hall.

Filed by Doug Watt, Advisor.ca, dwatt@advisor.ca

(06/20/03)

Doug Watt