Deceptive Business Practices Lawyer
Do you know the difference between fraud and scam? Fraud involves deception resulting in breach of trust and confidence whereas scam involves a fraudulent scheme to take money usually through a business transaction. A broker or financial representative who presents you with a seemingly good investment deal may actually be scamming you.
Investment scams involve strategies that take your money away from you. Scammers use a variety of persuasion techniques, such as playing the role of a helpless individual to get your sympathy, or bombarding you with facts and figures to appear credible to you. And unfortunately, the elderly are prime targets for investment scammers. However, scammers can even fool savvy investors. Don't fall for it! Instead, take action to protect your security. Be aware of potential investment scams such as the following:
- "Selling away" - when a broker sells you stock that he/she is not authorized to sell, or you purchase shares in a non-existent company
- Ponzi schemes - investment scam that pay returns from either your own money or money paid by subsequent investors instead of paying the actual profit earned on the investment
- Pyramid schemes - similar to Ponzi schemes, investments where returns are only given when participants recruit new members; typically, the product or company invested in does not even exist
- Affinity scams - infiltration of social, religious, charity, or similar groups by a con-artist to lure them into a Ponzi scheme or other type of financial fraud
- Forex scams - where a broker sells investors' positions in the highly volatile and risky foreign exchange market without proper disclosures or warnings
- Non-disclosure - often the single biggest scam performed by brokers, non-disclosure means the broker sells you a product without disclosing its market risk, suitability for your age, objectives, or financial condition
- Churning - when a broker buys and sells securities in your account to generate more commissions for his/her benefit, not for you the investor
- High-yield investment programs (HYIPs) - often unregistered/unsecured investment programs that promise "guaranteed" returns that re "risk free"; they typically promise annual, monthly, or even daily returns at 30-40%
- Pump and dump schemes - scams in which promoters boost stock prices by giving false or misleading statements about the company or product's success (pump), and then quickly sell all their own shares to the market a high profit (dump)
View common tactics used by scammers
and unsuitable investments
in the glossary to understand how scammers exploit individuals, especially the elderly.
Fraudulent financial representatives know that most people don't have a good understanding of the securities industry. They use complex, technical-sounding words and give vague details when questioned more closely about an investment or references.
You don't have to be a victim of investment scams. Contact Andre Perron
to discuss your case today; he will answer you honestly about your options to pursue legal justice against scammers.