The WA state government is warning investors against east coast property spruikers, following a spate of ‘free’ property investment and wealth creation seminars held by groups based out-of-state.
Anne Driscoll, the state commissioner for consumer protection, said a number of eastern states’ operators have been conducting ‘free’ seminars in WA and more are scheduled – but those who attend may not get what they expect.
“The advertising of these seminars give the impression that those who attend simply receive free information about how to secure their financial future but, in fact, they are subjected to high pressure sales tactics that promote coaching and mentoring programs costing between $3,000 and $10,000,” Driscoll said.
Driscoll said the seminars highlight the benefits of property investment, while downplaying the risks.
“They appear to exaggerate the potential gains from property and other investments by following the promoter’s programs. The seminars appear to be just a clever sales tactic to get people into a room for many hours with the hope that they will sign up to expensive training courses, but very little information is offered for free. The question to ask is what would be the benefit to a promoter of holding a ‘free’ seminar if they didn’t sell something at the event?”
Driscoll added that Consumer Protection officers attended three separate seminars and reported that all followed a similar formula:
- The seminars were free to attend but were mainly a forum to sell expensive mentoring and coaching programs;
- They downplay the risks and costs involved in property investment;
- Claim to offer the secrets to financial success;
- Presenters offer hints or teasers at the seminars, but participants had to pay for programs to get any further information and
- ’Special’ rates for the programs were offered if attendees signed up on the day
Despite the state government warning, Perth-based general manager of sales and operations at AFG Mark Hewitt said questionable property investment seminars were nothing new – and aren’t unique to WA.
“I think property investment seminars have been common place in the market for probably 30-plus years and I don’t think they’re distinct to Western Australia; they were quite common in southwest Queensland at one point and I still think they probably are.”
Driscoll urged any potential investor who feels pressured into a transaction to consider their rights. “In certain instances, people may have rights to a 10 day cooling off period if they signed up for something they were not aware would be offered to them when agreeing to attend the seminar.
“If people believe they have been pressured into buying something under those circumstances, they can contact Consumer Protection to have their cases reviewed and to ascertain their rights.”