Sunday, June 26, 2011

Stanley Gibbons Accused of Misleading Marketing

Reporter Emma Simon writes on the U.K.'s Telegraph website, "Experts urged not to believe all of stamp dealer's Stanley Gibbons's marketing spiel."

According to the piece, Stanley Gibbons sends out 400,000 leaflets each year promoting its Capital Protected Plan, which offers a money-back guarantee.

"Here, investors deposit a minimum of £10,000 for a period of between five and 10 years. This buys a portfolio, typically of between five and seven rare stamps. They can keep it at home, or Gibbons will store and insure it at its Guernsey office for free," writes Emma.

Ian Lowes, the managing director of Lowes Financial Management, a firm of independent financial advisers is quoted as saying, "Reading the marketing material made me shiver. It highlights how careful investors have to be when buying unregulated products – like stamps and other collectables. If I tried to sell investments like this to my customers I'd be shut down by the regulator. Stanley Gibbons uses every trick in the book to make people part with their money. There is no attempt to explain the risks involved, or detail potential downsides, like early exit charges."

Emma sums up the article by saying, "Remember the two key tenets of investments: you don't get high returns without taking some risk. And if it sounds to good to be true, it probably is."

To read the entire piece, click here.
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posted by Don Schilling at 12:01 AM