Five Tips to Help You Avoid Investment Fraud
In anarticle published on NevadaAppeal.com, Deborah Jaquith, Director of Communications, AARP Nevada State Office, offered five tips to help investors avoid investment fraud:
- Watch for warning signs. These often include promises of overly high returns, risk-free investments, or "special offers." (For more "red flags," read our article on common investment fraud tactics.)
- Review investment products and accompanying documentation carefully. Our attorneys have written repeatedly on how important it is that investors thoroughly understand a product before they invest in it. Make sure you understand what you're investing in, how the product expects to make a profit, and what the risks are. And, remember, missing documentation is often a warning sign of fraud. Every investment opportunity should come with a prospectus or offering circular of some kind. When in doubt, check the product's registration with your state's securities regulator.
- Do your own research. You should always investigate a broker, brokerage firm, investment adviser, or other financial professional before investing. For information on how to conduct due diligence online, click here.
- Check your own comfort level. Don't discount your intuition. How do you feel about the investment product and the person selling it? If you get a twinge of doubt, pay attention. Conduct additional research or walk away. Safe is usually better than sorry.
- Help others. Sometimes the best way to learn is to get involved and teach others how to avoid investment fraud.