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The best tips and tricks to help avoid securities and investment fraud

by on September 5, 2019 in Latest News, Lead Article, News you can use

The best tips and tricks to help avoid securities and investment fraud

As an investor, it is important to avoid securities and investment fraud. Here are some tips and tricks to help with avoiding this fraud.

Worried about securities and investment fraud? Want to make sure you don’t get taken for a ride?

While investing wisely can be extremely lucrative, there is also a lot of potential for getting it wrong. Unfortunately, there are a lot of scams and fraudsters out there that want you to part with your hard-earned money, and if not careful, you may find yourself facing securities and investment fraud.

Securities fraud occurs when the information you’re given about an investment is false or misrepresented in some way. There are several things you should be doing to avoid investment fraud and to ensure that you’re not misled.

Luckily, we’ve got your back. Below we’ll tell you about the best tips and tricks you can use to avoid securities and investment fraud.

  1. Do Your Research

The first thing you need to do to avoid falling for an investment scam is to make sure you don’t take anything at face value. Don’t just blindly believe the things you hear or take someone’s word if they say there’s an investment opportunity you shouldn’t miss.

Instead, do some research of your own and dig deep to find out what you really think about a particular investment and whether it’s legitimate or not. Search online and you may find that an investment isn’t everything that you were told that it was.

Don’t just rely on opinions, but get a company’s information at the source to learn about its products, services, finances, and business model.

In addition to learning about each particular investment opportunity, you should also learn everything you can about securities fraud itself. This way, you’ll have a better chance of identifying it and avoiding it when the time comes.

  1. Check Another Source

In addition to doing your own research, you should always get a second opinion on a particular investment whenever you can.

Speak to a professional and discuss the investment opportunity with them to get another perspective and to have a greater understanding of what you’re dealing with. A lawyer, an accountant, or a qualified advisor can be helpful sources to turn to if you’re trying to get a more in-depth look at a company or at the opportunity at hand.

  1. Find Out Who You’re Talking To

If someone is pitching an investment opportunity to you, it’s important that you know exactly who you’re talking to. You need to learn everything you can about them to ensure they’re legally allowed to sell securities in your state. You should also find out about their personal history and qualifications.

If you want to learn more about a broker or advisor, you can ensure they have valid registration by checking the state securities regulator. You can also check for disciplinary information on brokers and financial advisors by checking the FINRA BrokerCheck database.

Learning everything you can about the person telling you about an investment opportunity will make it more likely that you won’t get scammed in some way.

Instead, make a habit of always taking your time to consider an investment carefully before making a final decision.

  1. Be Especially Careful Online

It’s especially important to be cautious about any unsolicited investment offers, social media posts, or opportunities you find online through email or social media. The internet is rife with scams and fraudulent activity and you shouldn’t trust everything you see.

As mentioned above, it’s important to do your own research on any opportunities you come across to make sure they’re the real deal and to come up with your own conclusions.

On social media and email be especially careful of accepting messages from people that you don’t know. If someone offers you a special opportunity in an unsolicited way, it’s best to be suspicious of it.

  1. Beware of a Friendly Face

Most fraudsters don’t wear a badge letting you know what they’re up to. Often they’ll be incredibly friendly and charming and will be the last sort of person you could expect to be leading you astray.

Because of this, get in the habit of checking a person’s background and doing your own investment research even if you feel like you can trust the person or even if the opportunity they’re telling you about seems authentic.

By refusing to rely on appearances alone you’ll be much less likely to make a mistake or to fall for a costly scam.

  1. Be Suspicious of Guarantees

In the world of investing, nothing is guaranteed. Things that seem too good to be true often are.

If someone tells you that an investment opportunity is a “sure thing” or that there is “no risk involved” you’ll probably want to run in the other direction. Risk is a necessity in the investment world and while you can do things to reduce your risk it’s always a possibility that you’ll lose money. Don’t buy into the sweet talk and know that there’s always a possibility that you’ll lose big.

Always discover for yourself whether an investment opportunity is worth pursuing, and if you decide that it is, make your investment knowing full well that there are no guarantees.

Using These Tips to Avoid Securities and Investment Fraud

Unfortunately, investment fraud is a reality and there are people out there who will lead you astray with false information.

Luckily, by using the tips and tricks above you’ll give yourself the best chance of avoiding securities and investment fraud and protecting your hard-earned money from predators and criminals.

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