New York Investment Fraud Targets Internet Users

Fraudsters have found that one of the best ways to perpetuate investment fraud in New York is to catch you online. Although the Internet has made investing easier in a lot of ways, the lack of rules and regulations online mean that you need to be especially careful.

What Are the Common Types of NY Investment Scams Online?

Some investment schemes, such as the Ponzi scheme or the "pump and dump" scheme, appear online as often as they appear offline. However, online investors in NY should be especially cautious regarding:

• Online newsletters. While some online newsletters provide valuable information for investors, other newsletters are actually paid to promote certain stocks or carry advertisements for brokerage firms. Oftentimes, this means you're receiving biased or outright false information from a seemingly legitimate newsletter. This is not an illegal practice as long as the newsletter discloses that it is a paid advertisement, but you can be assured that it's buried in the "fine print."

• Online forums or discussion boards. While these forums can help investors communicate, fraudsters can also use these boards to perpetuate a scam by creating fake accounts touting a certain investment. Some firms even pay promoters to play the part of an unbiased observer. A long thread of positive comments gives the appearance that many people have had success with an investment, even though these comments have actually been left by promoters, large corporations, or fraudsters under the guise of an "average Joe."
• Spam E-Mail. You are probably familiar with the "Nigerian scam" style e-mails, but also be on the lookout for e-mails that seem to legitimately recommend an investment or firm. Fraudsters have been known to use bulk e-mail to either promote a fraudulent investment opportunity or to falsely "talk up" a company. These messages appear to be personalized to you or may mimic the logo or style of a legitimate company.

How Can I Protect Myself from Online New York Investment Scams?

The good news is that you can avoid getting wrapped up in online securities fraud by taking a few smart steps to protect yourself:

• Be wary of any investment that promises high yields with low risk.
• Do your research.
• Get it in writing. Always ask for hard copies of all documentation.
• Meet in person. Don't rely solely on online communications.
• Protect your personal information, such as your bank account number or even just your phone number.

If you have already been the victim of online investment fraud, contact an experienced investment fraud lawyer today at 1-866-8-BROKER to schedule a free consultation. We will also send you a copy of our newest book, Five Signs of Investment Fraud ...And What to Do if It's Happened to You, which we hope will answer your questions about the options available to you. At Meyer Wilson, we are devoted to helping investors recover their losses through stockbroker mediation, arbitration, and litigation.