Vending Machine Investment or criminal ploy? How to tell the difference

A warning for consumers looking to supplement their income in the midst of a tough economy. 

Experts say vending machines may seem like a good investment - but you can get short changed if you don't do your homework.

U.S. Postal Inspector Don Washington says "One of our victims was an elderly lady who lost her entire life savings."

And she was not alone.

Investigators say thousands have been taken in the U.S.  In most cases, the people behind it make big promises.

"Our suspect was very savvy, confident man. When he approached the potential investors (our) victims…he told them they could double their money. "

In this case, the suspect promised he would help investors set up their own vending machine company and they would get high returns if they allowed him to teach them the ropes.

"As they gave him their initial investments, he would come back to them he would need more money on top of the start up money to get the business up and running. "

In this case, there was no business. The person was just stealing money. Postal Inspectors started tracking him when they learned he was sending fake business letters through the mail.

"We basically followed our suspect and eventually found him in Las Vegas, he was an avid gambler and that's what he was doing with a lot of the money."

The suspect in this case was recently sentenced to 25 months in prison and ordered to pay  $500,000 in restitution.

Some important things to remember:

  • Do your homework. Contact agencies like the Better Business Bureau to find out if the company is legitimate.
  • Consult a financial adviser or lawyer before any money is exchanged or before signing any agreement.
  • Ask the company to confirm earning claims in writing.


 

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