Stock Scams to be Aware Of

There are many stock scams that you should be aware of in todays’ investment market. Is there one particular group of people that need to be even more cautious? Yes, there is. That would be today’s Senior investors. Why is that? Well, first of all, many of todays’ Seniors are on the lookout for investments that promise much higher stock returns. However, because of that, scam artists have been able to fraud individuals who are of age sixty and older. They makeup up a whopping thirty percent of scam artist victims. So how can you avoid being the next victim of an investment fraud?

You can avoid this by being aware of all of the different types of scams that are circulating.
One plan to be leery of is a charitable gift annuity. What is that? That is when a scam artist poses as a leader or head of a charity organization. They will often promise lifetime annuity income in return for making a donation. How can you prevent being a victim? First of all, you should make sure that the charity in question is real. The Better Business Bureau will be able to verify this. Go with your gut on these types of things. Chances are if you do not have a good feeling about it, you should probably avoid it all together.

Another type of scam in the investment world has to do with risk-free investments. These scams can usually be detected by the too-good-to-be-true investment opportunity they will give you. Some of these scam artists have promised older investors up to eight percent in returns. That is just about as unreal as you can get! They will also often promise you no penalty and that you can receive your money whenever you would like to. If you are unsure about a company, check to see if they are with the SEC. They must be already registered here in order to be a tried and true company.

What is another recent investment scam? High-return CDs have recently been linked to another scam. Although traditionally, CDs have only been offered in banks, there are now many brokerage firms that are also offering this type of plan. Scam artists have taken advantage of this. They do this by posing as a firm and then selling CDs that are non-existent. How can you detect a CD fraud? If you have never heard of the company, you should be careful. Also, if they promise a very high percentage in returns you should be leery as well. After all, CDs are usually considered very low risk.

Besides fraudulent brokerages, there has also been a rise on fake lenders. These lenders are particularly targeting the elderly with their loans. The reason they are targeting Seniors is because many times it is the elderly that are looking to refinance their home. How can you avoid this? If you are uncertain about a company or a lender, show a lawyer. They will usually be able to tell you whether the company is legitimate or not.