HANNA MUSIDI:
Hi, my name is Hanna and today we have our US tax expert, Derren. We also have our US real estate and legal expert, Jay. We will be discussing Us real estate forensic.
VOICE-OVER:
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HANNA MUSIDI:
Hi, we’re live. Hi, my name is Hanna and I’m based in Indonesia and I’m working in an international tax consultant team. And today we will talk about your US real estate forensic. And this episode is about a real estate scam. So right now I’m here with two of our experts. So first of all, Derren, would you mind introducing yourself?
DERREN JOSEPH:
Hi, thanks, Hannah. Hello everybody. So we continuing this series. My name is Derren Joseph, and I’m an international tax consultant with a team called Moores Rowland and my specialty is an international tax in general, but US international in particular. Good to be here.
HANNA MUSIDI:
Jay, would you mind introducing yourself?
JAY KNIGHT:
Yeah, sure. My name is Jay Knight. Thanks very much for having me again. I am an international real estate investor and I also am a real estate broker from California, so great to be here. Thank you.
HANNA MUSIDI:
Okay. I think in the US, there’s also a coffee shop that if you buy the small, you have the small size of beverage and the coffee shop always say, hey, why don’t you buy the large one, in Indonesia, it’s 2000 more or if you go to fast food store, if you buy a burger and say, hey, why don’t you buy the package like a fries and add a drink, give you a special price. That one is bait and switch. Number nine is a repeated effort to sell you more and more expensive products and services. So, Derren do you have anything to say about this? I have something to say a lot about it.
DERREN JOSEPH:
I think this equally applies to both the courses as well as projects in terms of the real estate projects. In a previous episode, we evaluated a real case of a wealthy Indonesian family. Well, again, I don’t know whether there were four, there were allegations of dishonesty. We don’t know, they’re just allegations as part of the process. Yes, they invested did invest a small amount, like a few hundred thousand dollars and they got a substantial return pretty quickly. And then they hard selling to upsell, to invest more came. And when they invested not six figures, but seven figures that’s when things began to go wrong. So yes, there’s that pressure to go more and more. And similarly with courses. There’s a YouTube channel that I look at regularly called Coffeezilla. It’s an American guy, he’s devoted his time, and his child to disclosing and shining a light on basically dishonest courses online. And they are too numerous to mention, I watch a YouTube video for half an hour and I’ll see something like 10 of them got advertised and they all follow the same formula. Basically, again, it’s born from a similar scientific background, you’re using a sales funnel and yes, they get you in. They hook you with something cheap. You know, maybe the first course is $500, but they spend that $ 500-course time trying to upsell you to the $2,000 course. And then once you end the $2,000 course, the inner circle, it’s only for the elite. It’s only for the exclusive. And then you have the opportunity to buy the $25,000 course. So again, it plays on the emotions, it plays on those who could less afford it. And therefore they go into debt. Or if they’re more sophisticated, what they do is they have a finance arm. So they have a separate legal entity, which can lend you the money to pay themselves. And of course, if you don’t pay that other entity back, they come after you because it’s a legally binding debt obligation. So in short, it’s just like what we’ve been seeing previously, if it’s too good to be true, you can see that they’re deliberately targeting a lower-income demographic by offering credit terms. And you know that they are spending a lot of time upselling. It may not be for you. And that’s something, but every once in a while to be fair, just to be completely transparent in woodwork for some random person that they are at the end of the lock and they we’ll can the roll the dice to spend the last 200 bucks they have and able to parlay that sense of something meaningful, something sustainable, but that’s unusual. So you need to some degree of self-awareness and just be honest with yourself. These people are saying it’s guaranteed. You know, nothing in life is guaranteed. Even if you forget this says, but you look on your evaluate the content of what they’re offering, do you genuinely think this continual life around? Do you genuinely think that it’s worth putting your last $200 into and what will happen if it doesn’t work? Can you still survive? Can you pay the bills? Can you make your rent? Can you make groceries? Maybe if it’s money that you can afford to lose, you can still make your rent. You can still stay afloat if you don’t get it. And do you think there is a chance that you can turn it into something sustainable honestly, then maybe it’s worth trying otherwise no, it’s not for you.
HANNA MUSIDI:
I see. Do you have anything to add Jay?
JAY KNIGHT:
Not really. I mean, I just think that be careful of the concept of upselling products, telling you that if you, now that you’ve done this, and if you just do this, then you’re going to be into this certain, certain circle where you’re going to get even better leads and better deals. And it’s kind of stuff. Again, this is a very common tactic that’s used a lot of these courses and a lot of these seminars, and just be wary of it. And again, just to reinforce what Derren and you both said, it’s just that no matter what you do in life, nothing is just going to be a walk in the park most of the time. Whatever you do, you’re going to have to work hard. You’re going to have to really immerse yourself and understand and study how to do it because you know, there’s not a whole lot of new industries out there that it’s just, you just be the first one to do it. So all of these industries, people have been doing it for hundreds of years. So it’s not like you’re just going to walk into it and become this millionaire overnight. Now, again, there are rare cases where this does happen, but again, this is the exception and not the rule. So just be sure that you understand what you’re getting into. That if you are going to devote yourself to getting into these courses or that you’re going to take, you know, a good to a seminar, that if you really dedicate yourself and you really have a passion for it, and it’s something that you really like, then yes, you can become successful in it. Just like if you were gonna walk into take a course about the stock market or Forex or anything like that, you’re not going to just be an expert over it overnight. So I understand not going in and just be careful of all of these types of upselling. Because when we see that you have to ask yourself that really legitimate, or is this guy just trying to get me the bias product. So just be careful.
HANNA MUSIDI:
And then to piggyback you both, I’m going to say investigate, investigate, and investigate. If you are in real estate or something like that when you’re about to buy a compound or apartment, you need to investigate first, how much is it the electricity? How much is it? Or how much is it the compound fee or the apartment fee or something, maybe you need to investigate first because when you say, oh, this apartment is a good deal? And then, later on, you will be facing high price of electricity or water or the compound for your department. You need to investigate, investigate, investigate. So yeah, like Derren say as well. Okay, you can enter these courses, but then again, when you enter the course and you say, if you add more money like this and you will get this privilege.
JAY KNIGHT:
Yeah. That’s good advice especially, I mean, I know this is more geared towards, Americans doing deals in America, but in Indonesia, that’s very true. And you know, one other thing in Indonesia, just to put a period to this point is that you have to investigate who the developer is because there’s a lot of developers in Indonesia that are very shady. They’ll take your money upfront, but then they never complete the project and they’ll be long gone somewhere else in their own home country, just sitting by a pool somewhere. And you’ll have no idea where they are no recourse against them. They have to be very careful about the developer in Indonesia.
HANNA MUSIDI:
Exactly. Actually, there is some developer here, they say they are losing money for two years. And then the compound chief or something like that, they were asking, how do you lose money can we see all the reports? And then they see all the reports. There is so many blank slates. I mean, like this amount of money and they don’t have any responsibility, they don’t have any bills or anything. So that’s why, like, there are so many things I can say about it, but then again,
JAY KNIGHT:
It’s called green creative accounting.
VOICE-OVER:
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