Just too good to be true…
The Publican is launching its own Scamwatch Month to warn licensees about the rogue operators targeting the licensed trade.
Over the past few years publicans have been targeted by a range of campaigns from scaremongering letters demanding payments to meet government legislation, telephone calls from bogus sales people selling anything from advertising to rate appeals as well as new entrants to the trade being taken for thousands of pounds for the promise of the pub of their dreams. And that is only the start of it.
Many licensees and people looking to get into the industry have contacted The Publican concerned about being misled and being made promises which never delivered.
While some of these only take the licensee for hundreds of pounds, news has reached The Publican of licensees being put out of business because they were promised loans.
For the month of May we will be issuing advice on how to spot a scam, what to do if you feel you have being treated unfairly by a company or individual and how to complain to get some action taken.
The Publican is on the case and will be exposing these companies and unveiling their bad practices with our ongoing investigations. This week, we inform licensees about the main rogue scams that have targeted the pub trade.
The scam: Rogue recruitment companies
Potential licensees respond to adverts in the national press offering them the chance for training and to run their own pub for a fee of up to £7,000. Many who are promised pubs receive no offers and those who are placed find themselves in a tenancy at will with no job security. A number of these companies have had trading problems and have disappeared leaving the potential licensees out of pocket. The quality of the training has also come under the spotlight as failing to adequately train potential licensees. Pubcos have been slammed for allowing these companies to lease pubs from their estates.
The latest: Some companies are still trading, although the Department for Trade and Industry has acted against many and is continuing to investigate recent complaints.
The scam: Rogue energy brokers
Consumer watchdog energywatch has told publicans to be on their guard against rogue energy brokers.
The brokers target pubs, bars and hotels because they use a high amount of energy for a small business. They pretend they are independent and promise to look around for the best possible deal for the licensee. In reality they only represent one or two firms which they pass off as the cheapest.
The latest: Energywatch advises licensees to watch what they say on the phone when negotiating energy deals to avoid being tied into a verbal contract.
The scam: Rogue financial brokers
Licensees claim they have been promised a loan or a mortgage, have paid a fee of anything up to £350, and have not received the deal they were promised. Some licensees have also paid arrangement fees of nearly £2,000, while others paid for a valuation costing up to £1,600 and said they were not provided with the deal they were promised.
The latest: Some of these companies are known to have ceased trading - and have set up again under a new name.
The scam: Rate appeals
Licensees are stung by rogue agents, offering to appeal their business rates. The agents, who are often inexperienced and do not have the power to launch an effective appeal on behalf of the licensee, call up offering to help reduce business rates for a flat fee of up to £600.
Some agents will try, and fail, to launch an appeal but more often than not they will take the money and make no application at all.
The latest: The Valuation Office Agency - the organisation responsible for business rates review - has advised businesses to only talk to their own officers, reminding them that it is free for a businesses to launch an appeal itself.
The scam: Till roll scam
Licensees have been scammed out of hundreds of pounds for till rolls. Canada-based companies telephone licensees informing them they are their nominated supplier for till rolls. Licensees agree to a delivery having no hint of a scam until an extortionate bill arrives in the post. Bills for close to £300 arrive for products which are worth no more than £30. After refusing to pay, licensees receive threatening phone calls and invoices for fees are sent. Licensees cannot get hold of the companies by phone to cancel the order.
The latest: The Office of Fair Trading is investigating these companies and gathering information which will be forwarded to the Competition Commission in Canada.
The scam: The tourist directory Pubs across the country are being sent application forms to join a tourist directory from Swiss firm NovaChannel AG.
Licensees say the form asks them to confirm their pub details for the directory. However, they claim it is only in the small print that it mentions the payment of a fee and they have, unknown to themselves, signed up to a paid-for guide. Many claim they are suffering from threats of court action if they fail to pay.
The latest: The Office of Fair Trading has received numerous complaints about misleading advertising of industry entry guides and advises licensees not to pay money to any international directories.
The scam: Telephone charity scam
Pubs are telephoned by an individual claiming to be representing a charity magazine on drug awareness or the police on crime prevention. They ask the publican if they would like to take out an advert in support. If the licensee expresses an interest an invoice is sent to cover the distribution of information booklets in local schools. In many cases, the leaflets are never received. Even if they are delivered, they are sold at a grossly inflated price. The latest: Legitimate charity Drugscope has warned licensees not to be fooled by false claims in the information suggesting the involvement of its organisations. Police have also issued concerns and warnings.
The scam Scam letter
Licensees receive an official-looking letter claiming to be from a government agency. Some licensees received threatening letters from a rogue company calling on them to pay £95 to sign up for data protection.
Pubs have also been targeted with a new wave of letters - one calling for a fee of between £125 to £249 to comply with new health and safety laws, another asking for £75 for a compliance pack to meet new money laundering regulations.
The latest: The Office of Fair Trading has taken action against some of these companies.
The scam: The pub regular?
A con involves a man telephoning the pub pretending he is a regular.
He persuades the licensee that he knows him and asks him to invest a sum of £800 to £900 in a car he is buying - claiming they can split the profits.
The licensee then puts the cash into a taxi and delivers it to a train station that has been agreed.
The latest: Police have issued a warning about this scam. Licensees are advised to contact their local police station or contact The Publican if anyone approaches them with a proposition like this.
Profile: Cat and Fiddle, Macclesfield
