Investing is an excellent way to optimize your assets and build your savings. Whether you are an experienced investor or just beginning a portfolio, being able to tell a good investment from a deceptive one can protect you from costly losses.
Investment fraud can compromise your financial accounts and put you at risk of other problems including identity theft.
Research new opportunities
When you hear about a new investment opportunity the anticipation of making money should never overshadow doing your research. According to AARP, some questions you should ask during your research include the following:
- What strategy does the investment company use to make a profit?
- Will a broker handle your money?
- Are financial products registered with the SEC?
- What are the contingencies if you want to exit?
- Are there participation fees?
- What is the required buy-in amount?
Assessing the answers to these questions will allow you to make an informed decision to protect your money.
Know when to say no
When you hear offers that sound too good to be true, think twice before signing up. Investment scammers usually ask for money upfront. They often cannot verify important information. If you ask general questions, they cannot give adequate context. Never give money to anyone claiming to work for FINRA. Knowing what a scam sounds like can help you know when to say no.
Use caution when checking investment accounts. Do not give your private information to anyone. Log onto online accounts using a secure computer. Never leave your device unattended while logged into your accounts. Protecting your information and keeping it private can reduce the risk of confidential data getting into the wrong hands.