Heard One of These Five Phrases Lately? Watch Out – You Could Be
Looking at an Investment Scam.
There are almost as many ways to run an investment fraud scheme as there
are ways to operate a legitimate investment opportunity, but most con
artists use at least one of these five phrases to gain a victim's
trust and lure them into an investment scam:
#1. “It’s Guaranteed.” Whether the scam involves foreign exchange currency markets,
precious metals, abusiness startup, or any other conceivable investment “opportunity,” most con
artists will try to convince their prey that the purported investment
yields either a guaranteed profit or a guaranteed return of principal.
In actuality, almost all legitimate investment opportunities carry some
risk, and legitimate investment advisors aren’t allowed to guarantee
results. If someone says otherwise, he or she is lying.
#2. “Low Risk,
High Returns.” In the investment world, the potential for profit is directly correlated
to the level of risk. If you want the chance to reap high yields, you
have to be willing to lose at least some of your principal. Anyone who
says differently is out to con you.
#3. “Game Changing Technology.” Fraudsters who make unsolicited pitches to their victims often try to
entice interest with this phrase. They claim that a certain startup has
just created a new miracle drug, developed an amazing new process, or
made a major technological advance that is certain to change this or that
industry. In reality, most “game changing technology” is created
in large companies that have an extensive research and development budget,
and such advances aren’t likely to be financed through
cold calls or unsolicited emails. If someone is trying to convince you to invest
in the latest “game changer,” consider how your name got on
the list of people to call in the first place.
#4. “This is a Secret/New/Undisclosed Investment Opportunity – Don’t Tell Anyone!” Once again, ask yourself how you
heard about this “secret” opportunity. Did you initiate the
meeting or phone call that led to the sales pitch? If not, how did the
promoter find you? Why are you being offered such an“exclusive” investment opportunity? It’s also worth asking why the offering firm or promoter would
want the investment kept a secret in the first place. Such statements
should serve as a major red flag that something is amiss.
#5. “Won’t Last Long.” There’s only one reason to insert this phrase into any conversation
– to convince someone that he or she doesn’t have the time
to think before acting. This is the #1 high-pressure sales tactic used
by con artists, and it can be very difficult for some people to resist.
Just remember: Not only do you have the right to take your time before
parting with your money – it is the most intelligent thing you could
do. No matter how “hot” an investment might be, you should
have the time to call the SEC or your state securities regulator to check
up on the legitimacy of it and its promoter before you make a decision.
Be on the lookout for these five phrases, and you’ll be one step
closer to protecting yourself and your hard-earned money frominvestment fraud.
About our law firm:
Meyer Wilson represents individuals across the country who have been harmed
by investment fraud. All of our cases are handled on a contingency fee
basis and we never request a retainer of any kind. Contact us for more
information or complete the online form on the top of this page and we
will respond promptly.