Regardless of what truths are revealed there are precautions any investor can choose to help identify a possible investment scam.
The most common investment scams are those investors find in their emails. Fast rich schemes such as “This stock is prepared to soar 30,000% in three weeks” are frequently read and dismissed, but suspecting someone everyone trusts and respects is another story.
Here are seven key questions to consider:
- Does it guarantee high gain and “low risk?”
- Does it promise to know the future?
- Does it “guarantee anything”?
- Have you been one of the “lucky few who have been picked” to put money into XYZ business?
- Is the salesperson reluctant to furnish a prospectus or financial statements?
- Is the salesperson’s info “a hot inside tip?”
- Does the salesperson promise to have invested in the company also?