Red Flags of an Investment Seminar Scam

By Better Business Bureau


View all articles by this author

Falling victim to a fraudulent investment scheme can mean losing anywhere from a few hundred dollars to your life savings. While most people might not see the harm in sitting through an investment seminar, the Better Business Bureau recommends researching the investment company first, rather than run the risk of falling for a financial siren song over a free lunch.

Investment scams and schemes can come in many forms and a common technique to lure people in is the offer of a free financial seminar over lunch. In one recent case, scammers invited senior citizens to estate planning seminars and later coaxed their victims into buying promissory notes for purported foreign country investments.

Free-lunch seminars can seem like an easy way to get a meal, but attendees run the risk of being drawn in by the slick presentations and promises of big returns. Unscrupulous seminars often lure in leisurely senior citizens who have time and exploitable retirement accounts and real estate.

When listening to an investment pitch, BBB recommends looking for the following red flags:

They require a large up-front investment. Untrustworthy schemers might try to convince investors to pay a large amount of money upfront so they can get out of town with a large haul, rather than wait for the funds to trickle in.

They promise high returns for low risk. Every investment comes with a level of risk. Typically, the amount of risk increases in line with the potential return on the investment. If the seminar is trying to sell an investment scheme that claims a high return with little or no risk, beware, even if it comes with the promise of a money-back guarantee.

They employ high-pressure sales tactics. Seminar leaders often use high-pressure sales tactics to get people to sign up without thinking it through. They might claim that there are only a few spots left or that you need to get in on the ground floor today to see the largest earnings. Any reputable investment company will let you take your time and do your research and will not pressure you into signing a cheque.

Investments rely on offshore investments. Many hucksters try to give their scheme an air of sophistication by relying on overseas investments, such as foreign currency, property, stocks and bonds. They also might claim, incorrectly, that you can avoid taxes by investing overseas.

It sounds too good to be true. At the end of the day, if the offer sounds too good to be true, it probably is. Always listen to your instincts because the potential payoff is rarely worth the risk.

Check it out with the BC Securities Commission. To learn more about the investment opportunity, go to investright.org to check out the company or advisor.

For more advice from your BBB on financial planning and investing, visit the BBB website; Vancouver: http://www.mbc.bbb.org , Island: http://www.vi.bbb.org


JULY 2010 SENIOR LIVING MAGAZINE VANCOUVER ISLAND
JULY 2010 SENIOR LIVING MAGAZINE VANCOUVER & LOWER MAINLAND

 

This article has been viewed 1867 times.


Comments

Showing 1 to 1 of 1 comments.

I suppsoe that sounds and smells just about right.

Posted by Karik | July 23, 2011 Report Violation

Post A Comment





  • security key

Comments that include profanity, personal attacks, or antisocial behavior such as "spamming," "trolling," or any other inappropriate material will be removed from the site. We will take steps to block users who violate any of our "terms of use". You are fully responsible for the content you post. Senior Living takes no responsibility for the views and opinions of members using this discussion area.

Submit Articles

Current Issue

Search For Articles

  

Subscribe To
The Magazine