Warning Signs Of Investment Frauds

By Dwayne Gilbert

If you want to know how you can protect your invested money, then you must learn to identify the signs of fraud. A potential investment fraud has certain signs and characteristics. If you can check them out, you will definitely save your hard earned money. There are thousands of frauds who use your email or call you on the phone countless times to convince you of the various schemes they have.

The first prominent sign or characteristic of an investment fraudulent act is that the offer will sound too good to be true. You will be promised even what Bill Gates would hesitate to do. Then be sure that you are dealing with a bunch of frauds.

The second warning sign of such offer is the emphasis for 'on spot' acceptance. You will be told that the offer is limited and meant for limited, privileged number of people only. The third sign of warning is that the company would always try to hide their real identity and avoid making serious disclosures about themselves.

You may be approached for investment by anybody. It maybe a broker, a stranger, or any person who is into any investment business. They may fish cleverly for details such as your social security number, credit card number or confidential things. The government has circulated pamphlets and federal documents that you should go through before you invest in securities or stock markets.

There are materials on fraudulent activities that you can ask for from SEC, Federal Trade Commission, or from your State's Securities Regulators. These materials will bring to light the various kinds of investment frauds prevalent in the country and their methods of approachability. If you are approached for any investment by a company, then you will find the offers suitable to your need. You must do the following for a safe investment.

Contact the State Securities Regulators (SSR). You must not stop with the facts from SEC. Instead, you should check the SSR to have more information on the company that has approached you. To access the SSR, you can log on to the website of North American Securities Administrators Association. The local SSR will provide you with all the information from Central Registration Depository (CRD). To know about the brokers, this is all that you need to do.

You can also check in the website of Financial Industry Regulatory Authority (FINRA) to know more about the firm concerned. The authority has all information about the broker and the firm. If you want to make investment based on the offers over phone or email, here are certain tips to do them wisely.

You must read the facts and offer thoroughly.

Try to understand what every line means.

Never accept an offer that you don't understand.

Never invest in companies that don't report with SEC, as they usually indulge in investment fraud. Verify all claims of the new contracts. It is also essential to see whether the people of the company have ever made money for investors beforehand. With these tips for a little homework, you can save your huge amounts from being wasted.


About The Author:
Gavin Keller owns and operates http://www.investment-fraud-info.com/. Know more about Investment Fraud and scams, and how you can protect yourself against them.