How can I avoid investment scams through social media sites like Facebook?

 

A:

As social media becomes a crucial vehicle for doing business in the modern world, more and more fraudsters are taking advantage of social media sites' ability to reach many people at once. However, even though the face of the investment fraud has changed, the basic tactics for protecting yourself have not. Whether you are offered an investment opportunity in person or via a social media site like Facebook, LinkedIn, or Twitter, you should always:

• Be wary of unsolicited investment offers. If you receive an investment offer from a broker or company you've not dealt with in the past, be prepared to do your research and check with state regulators for more information about who you are actually dealing with.
• Beware a promise of low or no risk coupled with high returns. All investments come with an element of risk, and the higher the returns are, the higher the risk should be.  
• Raise an eyebrow if you feel pressured. One way that fraudsters coax investors into handing over their cash is to pressure them into believing it's a limited-time offer that won't be available in the morning. This should be a glaring red flag that something isn't right and probably isn't on the up and up. 

One additional action you should take when it comes to online investment scams specifically is to check your privacy settings carefully so that you are in control of who has your personal information.

If you believe you have been taken in by a social media investment scam, speak with one of our expert securities fraud attorneys for direction. If you would like more in-depth information about protecting yourself and your rights, request your free copy of our must-read book Five Signs of Investment Fraud ...And What to Do if it's Happened to You. Speak with us today at 1-866-8-BROKER (1-866-827-6537) with any questions or concerns.