I was always told that friendship is one of the most important things in life. We should treat our friends with respect, loyalty, and honesty. So when my friend told me he was selling shares of his bar, I was more than a little taken aback.
The fact is, many bars in Singapore get cash sponsored by alcohol distributors and most of the time, the cash sponsor easily covers the cost of the bar.
In other words, the bar is “free” and he is selling these shares to others at an exorbitant rate to make a profit.
My friend was offering me the opportunity to buy a percentage of his bar ownership at a 200-500% inflated price. He presented it like a great deal, and I was tempted. But I was also keenly aware of the fact that if the bar went down, I would be the one to suffer the losses.
In the end, I decided to go ahead with the purchase. I figured that if I was careful and kept an eye on the bar’s performance, I would be able to get out before any major losses occurred. I also figured that if the bar did go down, I would have at least made some money in the process.
It turns out I was madly wrong.
The bar was not doing well and I was losing my investment. In the end, the company went haywire and the bar had to close down.
Later on, I found out he was repeating this scam at many other bars and repeating this scam tactic to others.
I later found out that many people who are in the bar and alcohol industry are very aware of these scams and always present them as a fake lucrative opportunity to people who want to own a bar.
After getting the sponsorship from the alcohol distributors the scammer will recuperate any money invested in the business and quickly sell it off for a profit. Even if the bar closes and goes down, the scammer does not lose any money.