Stay informed and be cautious

Guarding yourself against investment scams

Investment scams can be devastating, promising high returns while stealing your hard-earned money. But by staying informed and cautious, you can protect yourself. 

 Red flags to watch for: 

 Guaranteed high returns: If something sounds too good to be true, it probably is. Legitimate investments involve risk, and the promise of guaranteed profits is a classic scammer’s tactic. 

• Unsolicited offers: Be wary of investment opportunities that come to you out of the blue, especially via phone calls, social media, or email. 
• Pressure to invest quickly: Legitimate investment professionals understand the need for research. Scammers will often pressure you to invest immediately before you have a chance to do your due diligence. 
• Unlicensed sellers: In many regions, investment professionals must be licensed. Verify their credentials with regulatory bodies before investing. 

 Steps to secure your investments: 

 Research before you invest: Take time to understand the investment and the company behind it. Look for information on the U.S. Securities and Exchange Commission’s EDGAR database or consult a financial advisor. 

• Verify the seller: Check the background of the person selling you the investment. Use resources like BrokerCheck by FINRA to confirm their license and see if any complaints have been filed against them. 
• Get everything in writing: Don’t rely on verbal promises. Get a prospectus which outlines the investment’s details and risks, and any agreements in writing. 
• Don’t share financial information: Never give out your bank account or social security number to someone you don’t know or trust completely. 

 If you’re unsure about an investment, walk away. There will always be other opportunities. By following these steps and staying vigilant, you can safeguard your finances from investment scams. 

• June 17, 2024
• Financial
• Ross Bentzler

About This Author

Ross Bentzler

Ross Bentzler is Executive VP and Information Security Officer for Alpine Bank. Ross has worked in the information technology field for two decades, focusing on information security for 13 years.

More about Ross Bentzler

LinkedIn