Although anyone can fall victim to financial fraud, some investors are more likely than others to be targeted by scam artists.
According to a survey conducted by the Financial Industry Regulatory Authority (FINRA) Foundation, victims of investment fraud differ from non-victims in their financial behavior. Below are five of the top high-risk behaviors that they share. If you’re engaging in one or more of these behaviors, you’re placing a bull’s eye on your financial security and making yourself a potential target for fraudsters.
Five Behaviors That Make You a Target for Scam Artists
1. Failing to Research Your Financial Advisor
Victims of investment fraud often know very little about their financial advisors. Failing to check your stockbroker’s licensing/registration credentials puts you at great risk of investment fraud. (And don’t forget to run a criminal background check on your broker, too!)
2. Buying High-Risk Products
Investors who buy high-risk financial products such as futures, penny stocks, promissory notes and private foreign investments are more likely to be victims of investment fraud.
3. Getting Financial Advice from Nonprofessionals
Taking investment advice from nonprofessionals (family members, friends, coworkers, etc.) is another high-risk behavior that victims of investment scams share.
4. Falling for High-Pressure Sales Techniques
Victims of financial scam artists are more susceptible to high-pressure sales strategies than non-victims. Pitches such as “You must act now!” are often taken at face value, rather than recognized as the aggressive sales tactics that they are.
5. Attending Free Investment Seminars
Actively seeking out new investments also puts investors at risk. In fact, victims of investment fraud are much more likely than non-victims to attend free investment seminars, thus opening themselves up to potentially fraudulent investments.
If you believe that you have been the victim of investment fraud, contact the investment fraud attorney at Carlson Law today at 619-544-9300 for a free consultation.