About 10 years ago, I gave a series of Junk Bond Seminars to the public. When you open something up like a seminar to the public, you never know what you are going to get. One person in the seminar had something to sell and was trying to get me to give her a copy of the names and phone numbers of the people attending the seminar. I refused to do it. Then she wanted to speak to the audience and I ignored her.She called me when it was all over and tried to get me to buy into some investment that she claimed she was selling. I told her that I do not buy direct investments into businesses. So she changed it to bonds. I asked questions about the bonds so she changed it to stock. I asked in what exchange is the stock sold on. That did not work so she changed it to nothing to do with stocks, bonds, nor business interest. I told her that I don’t fall for fly by night operations and I don’t invest $20,000 to $30,000 on a phone call. She claimed that she was going to call me back with a prospectus and more information on the investment. It has been 10 years and I never heard from her again.
Because of the economy and lack of jobs, people are doing what they must to survive. This is what the citizens of Harrisburg found out when they allowed its mayor to run the rebuilding of its incinerator. With the mismanagement of the School System and the mismanagement of the City, the people must pay back about $1 Billion. The population is only 48,000 people. Many of them women and children. Many do not work at all. Only 48% of the property is taxable and many people are not current with their taxes. The property owners and renters allowed the politician to invest their money in whatever they wanted with whoever they wanted. No law enforcement agency in the country is coming to their aid. Most money was scammed away without the knowledge of the people of the City.
It is up to you to protect yourself. Law enforcement can only do so much. Below is an article written by Allison Andersen, an employee of Zion’s Bank.
The current state of the economy at home and abroad has left many looking for alternative investment strategies in the hopes of boosting or, in some cases, rebuilding their savings. Scam artists are ever aware of this desperate search and are adept at preying on such insecurities and aspirations. Unfortunately, some individuals are seduced by false promises of high returns and little or no risk – hallmarks of most investment scams – and too often they lose considerably. In many cases, by the time fraud is realized, it is too late to recover lost funds.
A sound first step to avoid falling victim to investment fraud is to be able to recognize some common strategies con artists employ, and to be vigilant of other less conspicuous warning signs.
One centuries old tactic that has garnered recent media attention is the Ponzi scheme. Agents of this scam guarantee returns and interest payouts much higher than those available through most legitimate investments. Yet the money received from new investors is used to pay previous investors’ their return – none of the funds are actually being invested in a traditional sense. In order for this scheme to remain operational, there is a constant need for new investors. Therefore a Ponzi scheme typically disintegrates and is realized once the pool of new investors runs dry, depleting the money supply to pay current investors, or if the con artist runs off with all of the capital.
Affinity fraud is another practice used to deceive investors. In fact, according to the North American Securities Administrators Association (NASAA), a quarter of the Ponzi schemes in the past decade were built using this method. It involves targeting recognizable groups of people with common characteristics in order to build a false sense of trust about a fraudulent investment. Such groupings include persons of a particular religion, age group, ethnicity, or other organization. The notion that a particular opportunity has the support and participation of leaders and other members is used to develop the perception of security and legitimacy. Perpetrators of these schemes may engage group leaders to further strengthen their cause, or they may even be the leaders themselves.
In their list of prevalent cons, NASAA mentions that the unlicensed and unregistered sale and promotion of investment opportunities is becoming an increasing problem
(http://www.nasaa.org/3752/top-investor-traps/).
Individuals must be licensed and/or registered to trade or advise on the trading of or investment in securities. Following the direction of someone without these credentials can lead to incorrect or unfavorable transactions, which may result in unnecessary financial loss. NASAA encourages requesting verification of the license of any individual who provides you with specific advice or recommendations relating to your future investments and current holdings.
While we are living in a world of unprecedented discoveries and developments, investment scams and fraud are nothing new. Technological advancements in particular have changed the way we communicate, share and store information, and conduct business – for better or worse.
The Internet has allowed for greater accessibility of information, which can facilitate research of investment opportunities. However, it has also required a greater deal of responsibility to determine what data is credible.
Access to individuals via social media websites, email, and phone has also become easier with current technology. Consequently, these mediums are commonly used to enable investment scams. Any unsolicited phone calls requesting personal information should be met with suspicion. Many con artists will pose as representatives of banks, credit card companies, insurance companies and the like, and may provide a seemingly credible pitch.
While we are living in a world of unprecedented discoveries and developments, investment scams and fraud are nothing new. Technological advancements in particular have changed the way we communicate, share and store information, and conduct business – for better or worse.
The Internet has allowed for greater accessibility of information, which can facilitate research of investment opportunities. However, it has also required a greater deal of responsibility to determine what data is credible.
Access to individuals via social media websites, email, and phone has also become easier with current technology. Consequently, these mediums are commonly used to enable investment scams. Any unsolicited phone calls requesting personal information should be met with suspicion. Many con artists will pose as representatives of banks, credit card companies, insurance companies and the like, and may provide a seemingly credible pitch.
It is advisable to ask for the caller’s contact information and ask other questions to determine validity. Legitimate organizations should be willing to provide investment information in writing, but be aware that intricate language and fancy letterhead do not automatically indicate authority.
Be aware that many scammers will try to encourage you to make decisions on the spot, often giving compelling reasons to do so. Do not be pressured into making rushed decisions, as investment opportunities should be well researched and given careful thought, even to the point of consulting a trusted adviser.
Finally, it is important to remember that nearly always in the investment world, great reward comes with great risk – any promise otherwise is a red flag. The Financial Industry Regulatory Authority (FINRA) requires all advertising pertaining to investments be fair and balanced. If the person contacting you fails to mention risks or denies any instance of risk, they are likely dealing fraudulently.
If you are suspicious of any contact you receive in person, in writing, by email, or by phone, it is important to act. Check with state government agencies to verify the authenticity of the solicitor, their products, and their company. Whether or not you have fallen victim to investment fraud, be sure to report suspicious activity.
The following sources provide further details and advice regarding these and other common scams:
-FBI : http://www.fbi.gov/scams-safety/fraud-NASAA: http://www.nasaa.org/2815/nasaa-fraud-center/-FINRA: http://www.finra.org/Investors/ProtectYourself/
Alison Andersen is an employee of Zions Bank. Zions Direct is a non-bank subsidiary of Zions Bank.
If you ever woundered how many countries "Bond Investments" is read in. Here is the list from the countries with the highest readership to the countries with the lowest readership.
Be aware that many scammers will try to encourage you to make decisions on the spot, often giving compelling reasons to do so. Do not be pressured into making rushed decisions, as investment opportunities should be well researched and given careful thought, even to the point of consulting a trusted adviser.
Finally, it is important to remember that nearly always in the investment world, great reward comes with great risk – any promise otherwise is a red flag. The Financial Industry Regulatory Authority (FINRA) requires all advertising pertaining to investments be fair and balanced. If the person contacting you fails to mention risks or denies any instance of risk, they are likely dealing fraudulently.
If you are suspicious of any contact you receive in person, in writing, by email, or by phone, it is important to act. Check with state government agencies to verify the authenticity of the solicitor, their products, and their company. Whether or not you have fallen victim to investment fraud, be sure to report suspicious activity.
The following sources provide further details and advice regarding these and other common scams:
-FBI : http://www.fbi.gov/scams-safety/fraud-NASAA: http://www.nasaa.org/2815/nasaa-fraud-center/-FINRA: http://www.finra.org/Investors/ProtectYourself/
Alison Andersen is an employee of Zions Bank. Zions Direct is a non-bank subsidiary of Zions Bank.
If you ever woundered how many countries "Bond Investments" is read in. Here is the list from the countries with the highest readership to the countries with the lowest readership.
Top Five: 1. United States; 2. Russia; 3. Canada; 4. United Kingdom; 5. South Korea.
Second Five: 6. Germany; 7. Slovenia; 8. Ukraine; 9. Brazil; 10. Italy.
Third Five: 11. Hong Kong; 12. Ireland; 13. Lebanon; 14. Philippines; 15. Sweden.
Fourth Five: 16. South Africa; 17. Israel; 18. Palestine; 19. Poland; 20. Latvia.
Fourth Five: 16. South Africa; 17. Israel; 18. Palestine; 19. Poland; 20. Latvia.
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