Analysts bet on record Fonterra milk price to farmers

A Waikato man has lost his $300,000 inheritance in an elaborate but fake investment scheme that promised big returns.

The man, who talked to Stuff on the basis of anonymity, scrolled his way into a scam when he saw an advertisement on social media featuring Sir Dave Dobbyn talking about his investment with the company Super1Investments.

The 59-year-old was promised 400 to 600 per cent returns, but instead lost everything.

His father died about a year ago, leaving an inheritance that had been earned through the family business.

‘‘Dad would be really disappointed,’’ the man told Stuff. ‘‘I kick myself every day. What a dumb move.’’

He could see the red flags with the benefit of hindsight. At the time it seemed legitimate.

The man had been considering spending the inheritance on a new house and business in another city, but investing seemed like a smart idea.

The scammer called himself John Thompson, and said he was an American living in England.

Thompson provided a photo of himself, but a reverse image search showed it was downloaded from the internet.

‘‘He sounded like he knew what he was taking about. He was pleasant to talk to,’’ the man said.

The first payment was $10,000 at the end of August, to test the investment waters. The scammer told him he had earned $15,000 in one day, and $100,000 in a week.

He then made three payments in quick succession of $99,980, $99,950 and $93,000 in September.

The man was given a log-in for an account where he could watch his money gain returns.

The scammers asked for photographs of the man’s face and his licence as proof of identity. They also gained remote access to his phone via the app AnyDesk.

The man’s plan was to withdraw $15,000 a month to live on, and for the rest to sit in the account and make more money. The first payment never came.

‘‘I didn’t know a lot about [investing] and I told him that. He said, let me sort it.’’

The scam came to light when man’s bank contacted him with concerns about the large payments, but it was too late. He was told to get his phone cleaned of viruses, and a system was installed to block scam numbers.

This meant the scammer could no longer ring. He disappeared not long after.

The man said he was reluctant to contact the police, because he was ‘‘hoping like hell’’ things would just work out.

The worst part was that the company was still scamming other people, he said.

‘‘How do they get up in the morning and live with themselves? It makes me angry.’’

Police were investigating, with the hope of getting some money back.

ID Care New Zealand operations manager Neil Hallett said New Zealanders lost about half a billion dollars in about 1200 scam cases each year, and that was only the tip of the iceberg.

‘‘The more I see, the more I think maybe I am underestimating.’’

He said celebrity scams were common, and used known figures that people trusted.

‘‘We see it quite often, up to and including the prime minister.’’

Investment scams would pop up when banks were offering low interest rates.

Victims often didn’t report scams because they were ashamed, and some self-harmed.

‘‘My advice is to get in touch with your bank, get in touch with police, and ID Care.’’

Once scammed, victims were added to a list that was distributed on the dark web. Scammers often offered to help them get the money back, but for thousands of dollars.

Hallett said the first thing his company did was try to work out what happened, and protect what money remained by freezing accounts and changing passwords.

The recovery stage involved talking to police, banks, and foreign authorities.

‘‘But the chances are slim,’’ he said.

Hallett said if it seemed too good to be true, it probably was. His advice was to talk to a friend, and get their advice on what you were planning.

Future Vision Financial Advisors owner and director Grant Wood warned would-be investors against trusting any investment advice on social media, and said they should meet with an adviser face-to-face.

‘‘Find some local, and reputable. Don’t fall into the traps that are too good to be true.

‘‘Billions get lost in scams, it all looks quite real. Do not invest without meeting someone.’’

Economists have been hiking their expectations for Fonterra’s milk payment to farmers for this season, with most now expecting the cooperative to pay the highest level since it was founded 20 years ago.

In late October, Fonterra lifted and narrowed its forecast for the 2021/22 season to between $7.90 and $8.90 per kilogram of milk solids.

The midpoint of the range, which farmers are

TOM LEE/STUFF paid off, increased to $8.40 per kgMS, matching the previous record paid in the 2013/14 season.

Since then, tight milk supply and continued demand have underpinned prices on the Global Dairy Trade auction platform, prompting economists to raise their forecasts even higher, with BNZ and Westpac both picking an $8.90/kgMS milk price, ANZ at $8.80/kgMS and ASB at $8.75/kgMS.

Rabobank is likely to significantly increase its $7.80/kgMS forecast when it releases its next Global Dairy Quarterly report soon.

Its last forecast was released in September. Milk price futures recently traded at $9.01/kgMS.

In a research note, BNZ senior economist Doug Steel said recent GDT results and a contained New Zealand dollar suggests the milk price outlook is testing the top end of the cooperative’s forecast range, and said there was a ‘‘decent chance’’ the midpoint would move up closer to his record high forecast of 8.90/kgMS.

Fonterra was due to release its first-quarter operational results yesterday, which could provide an opportunity for the co-operative to update its forecast, Steel said.

NZX dairy insights manager Stuart Davison said global milk production was keeping prices supported for the time being, and it would take until the Northern Hemisphere producers kicked into gear before there were any real market fundamental changes to supply and demand.

He said the upper end of Fonterra’s forecast range was ‘‘very achievable’’ for this season.

‘‘The season is shaping up well for a great farmgate milk price, with a good proportion of the season’s milk produced, processed and sold, confidence in this season’s milk price is building quickly,’’ he said.

Davison cautioned that the reality for farmers was not as buoyant as the high milk price suggested as weather had been unpredictable in every region, and difficult to manage around, while farm working expenses continued to climb, squeezing profit margins, which was taking some shine off the potential for a record pay-out.

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