For Mark Roberts’ Use: Have you been solicited by a con artist lately? And would you recognize a fraudulent money scam, if it happened to you? According to a recent report by FINRA Investor Education Foundation, odds are high that you have already been approached by at least one fraudster. In fact, 84 percent of Americans over age 40 have been solicited this way. It makes sense that scammers would target this age group, because you’re feeling a sense of urgency to establish a comfortable retirement fund.
So, odds are pretty great that you’ve already been approached. Hopefully, you weren’t part of the 11 percent who said they have lost money to a fraudulent money scam. But just to be sure, ask yourself how you feel about the following statements:
- “This investment has made hundreds of people extremely wealthy” – 30 percent of survey respondents fell for it
- “The lowest return you could possibly get on this investment is 50 percent annually, but most investors are making upwards of 110 percent per year” – 42 percent believed this sounded plausible
- “There is no way to lose on this investment; it’s fully guaranteed” – 43 percent of those surveyed thought this statement sounded reasonable
Okay, so here’s the scary part: These are definitely shady statements at best, and reflect expectations that are almost always unreasonable in the investment world. A good con artist could work them into their sales pitch so subtly, that you might not realize you’re falling for empty promises.
The solution: Any time you’re approached with an investment scheme, follow these four rules:
- If it sounds too good to be true, then it probably isn’t true. There are very few ways to make a lot of money in a short amount of time, and they are usually extremely risky when they do occur.
- Never, ever send money or supply your bank account information without solid evidence that this person is on the up-and-up.
- Don’t fall for an “official” appearance. Having a website or nice stationery doesn’t mean the operation is legit. Check reviews with the Better Business Bureau, to start, and keep in mind that a con artist could pretend to be representing a legitimate company!
- Question everything.
With regard to that last rule, give us a call if you’re approached about any investment scheme. We can help you investigate its legitimacy, and help you decide if the idea fits into your overall, long-term financial plan.