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Arizona man groomed, then scammed out of entire 401(k)

By Gary Harper

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    GILBERT, Arizona (KTVK, KPHO) — John Smith uses his smartphone to make investments. “This is an app here is making some trades,” he told 3 On Your Side as John perused through his phone. “This is the gold U.S. dollar price.”

And not long ago, John came across an opportunity that he says he couldn’t resist. “I transferred in $100,000 on Aug. 16,” he said.

A hundred thousand dollars. But John says he realized he needed to get even more aggressive when it came to the stock market so he could catch up on his retirement. “I’ve been involved, dabbled in and out of the stock market over the years.”

John says it was about a year ago that he started talking to a woman online about investments. The woman said her name was Amie, claimed to live in China, and promised she could take John’s investments to a new level.

“It started off just friendly conversations with her, but over the months, this kind of trust and rapport was building,” he said.

And that trust and rapport grew. In fact, “Amie” even sent John personal messages like this one. “Happy Birthday, John,” the video message said. “I hope you have a great day,” she said smiling.

It was enough to lure in John even more. After all, he trusted “Amie” with investing his money. “I started off with, you know, a $10,000 investment made a little bit lost a little bit. I put $15,000 more into it and made a little bit more than I put in. In one investment, $48,000 grew to like $120,000 or $130,000.”

John says he was sent charts and graphs reportedly showing his investments were doing well. And that’s when he went for it all. He wired “Amie” along with her so-called investors’ large sums of money. “I sent about $190,000.”

It was almost John’s entire 401-K balance. But later, when it came to withdrawing some of his money for the first time, there was a problem.

“These folks that I’ve been actually contacting mostly through WhatsApp just vanished. I still had all their numbers and contact stuff, but you could tell the account was dead or no longer active,” John explained.

John says Amie is now no longer responding to his messages. And remember those charts and graphs that showed so much promise? John now acknowledges now they were simply fictitious graphs aimed at getting him to keep sending money. And now, he’s broke.

“It’s one thing if I was a multi-millionaire, yeah that’s a lump I can take it and get over it, but this is a little bit different,” John said.

The U.S Security and Exchange Commission warns consumers to be careful when investing and to avoid scammers. The agency says, “Avoid Phantom Riches,” where a large return is promised. Beware of the “halo” effect where the scammer comes across as trustworthy. And avoid being pressured to “send money now.”

John says he wishes he would have been more careful and wants to warn others when it comes to growing your money. “I would just say, just cover all your bases. Don’t take any of it for granted, and know exactly who, who is getting your money.”

John says it’s a huge financial blow and leaves him saving for his retirement all over. He wants other to learn from his mistake.

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