Investment Scams are on the Rise… Here are a Few Things to Watch Out For

Online Investing Fraud on the Rise

Britain’s financial watchdog warned the public very early in 2017 that the growing threat of online investment fraud was growing at an alarming rate after finding that investors lost tens of thousands of pounds a day with online fraudsters alone.

Binary options, foreign exchange and cryptocurrencies like Bitcoin were among the complex online trading schemes were just a few of the platforms where so many investors were taken for thousands and thousands of pounds.

Those investors that were swindled out of the majority of the money that used to invest were attracted by advertisements that promised high returns and featuring images of expensive watches and cars. The fraudulent companies would simply ‘distort pricing’ and tie in their investors with extreme payout clauses.

In Australia, binary options and similar investment schemes rose to an all-time $340 million record high in 2017. According to the Australian Competition and Consumer Commission (ACCC), that total was up over $40 million for the previous year.  Though the number of reports reported in 2017 was fewer than that collected in 2016, the average loss reported with each binary options scam increased by 24% which suggests that, though fewer, the effectiveness of these scams at collecting a larger amount of money from individuals is growing at too rapid a pace.

Employment Scams on the Rise

In the United States, unemployment stands at 3.7 perfect. With almost 7 million jobs available in September of 2018, the Better Business Bureau will be the first to relate that as more legitimate companies post available jobs online, more fraudsters will post job scams as their ability to hide in and among the real opportunities increases. More than 3,700 incidents were recorded in October, and that is more than double what we saw this time last year.

The changing dynamics of the labor market have emboldened scammers. With remote jobs being more common and a growing number of people taking on a part-time job or gig work, fraudsters had an easier time hiding behind electronic communications and present fake opportunities.

Employment seekers are told to be aware as anyone can fall victim to these scams. These scammers are running their schemes across all levels of income and required skill.  No one is safe, but everyone can be aware of the similarities of these scams.  The number one goal is to gather personal information like bank account numbers, social security information, and YOUR MONEY.

HOW TO AVOID THE SCAM

If the job appears to be valid and from a legitimate company, go to the company’s main website to make sure the position is available. Large companies like Amazon or Target can be impersonated because logos and other official-looking elements are very easily replicated with today’s technology.

Senior-Targeted Investment Scams on the Rise

The financial climate is prime for investment scams. Before-mentioned scams hit buyers of all ages, but seniors are especially receptive. The North American Securities Administrators Association (NASAA) states that maturer investors are being targeted with frequently involved investment scams including unregistered securities, promissory records,  and Ponzi schemes, all encouraging exaggerated returns.

Opportunists who perform these scams know that elders and others living on fixed wages are being milked in the modern financial environment. Their goods and deliveries sound tempting to many seniors who have seen their retirement nest egg diminish in the past few years.

Seniors, however, can educate themselves to avoid these schemes. The Better Business Bureau, along with the NASAA offers the following tips:

• Do not be a kindness victim. Con artists will not hesitate to misuse your good manners.
• Check out strangers promoting ‘too good to be true’ deals. Trusting stranger is a mistake anyone can make when it comes to their personal finances. Extensive background information on investment salespeople and firms is available from the Central Registration Depository files accessible from your state securities agency.
• Always stay in charge of your money. Beware of anyone who recommends putting your money into something you do not understand or who requests that you leave everything in his or her hands.
• Do not judge a book by its cover. Successful con artists sound and look incredibly professional and can make even the flimsiest investment deal sound as safe and sound as putting money in the bank. The sound of a voice, particularly on the phone, has no bearing on the soundness of an investment opportunity.
• Watch out for salesmen who prey on your concerns. Con artists know that you fret about outliving your savings. Anxiety can cloud your good judgment. An investment that is best for you will make sense because you understand it and feel comfortable with the risk involved.
• Watch your finances and ask questions. Do not compound the error of trusting an unscrupulous investment professional or a con artist by neglecting to keep an eye on the progress of your investment. Insist on regular written or oral reports. Look for signs of excessive or unauthorized trading of your funds. If you are stalled when you want to withdraw your principal or profits from an investment, consider that a red flag.
• Do not let embarrassment or fear keep you from reporting investment fraud or abuse. Con artists know that you might hesitate to say that you have been victimized in financial schemes out of embarrassment or fear. Every day that you delay reporting fraud is one more day that the con artist is spending your money and finding new victims.

This information is general and is not intended as a reliability report on any company, product, or service.