The Latest Investment Scams
It’s sad but true; the more money you have, the more unscrupulous people there are that will try to scam you out of it. Many people fall victim to financial scams every year, and despite organisations like the Office of Fair Trading (OFT) and others trying to raise awareness of the types of financial scams that are popular, it doesn’t seem to stop people being caught out.
Brand New Financial ScamsThere aren’t really any brand new scams. Most of the financial scams that crop up in the news tend to be variations on an old theme, just as many years ago businesses started receiving faxes from Nigeria saying they were in line for massive deposits of cash in return for their bank details – now it’s all done by email. Methods change but the basics are still the same – they want your money.
One investment scam that has several variations and has been appearing with alarming regularity recently is the opportunity to invest your pennies in luxury goods such as fine wine or gemstones. The sales people are convincing,, advising you that the investments are almost guaranteed to rocket in value. In reality, in the same way as cold-callers inviting you to invest in shares for up-and-coming companies that you’ve never heard of, you normally find that the stunning investment opportunity you’re being offered is totally over-priced, risky and will be incredibly difficult to sell on.
Most of these so-called investment opportunities come from abroad, so if you’re approached with a sure fire, cannot be missed opportunity from another country, that should ring warning bells straight away. These investment schemes will not be authorised by the Financial Services Authority, which means if the deals turn out to be less than excellent after all, there’s nothing the FSA can do to help.
Thinking of Investing Money?The general advice to anyone who wants to invest their good money in something is to take advice from a qualified, independent financial adviser before agreeing to anything. The cold hard truth is that any investment offer that’s marketed as ‘too good to be true’ usually is. Why is it so imperative that you invest in the gemstones, wine or even shares right now...most reputable companies wouldn’t press you for an instant decision, and certainly wouldn’t expect you to make decisions involving large sums of money over the telephone.
Never ever consider going along with any investment opportunity that’s described as confidential. It will all end in tears. Check that you’re dealing with a reputable firm, and don’t do business with any firm that isn’t registered with the Financial Services Authority. If things go wrong, or you feel you’ve been badly advised, even scammed, you’ll have no comeback if there’s no registration.
Not Always RecommendedAnother trap that investors can fall into, is taking advice from people on investments, going by recommendation or a tip-off. While this is all good if you’re getting the advice from someone who knows their stuff and also isn’t trying to swindle you, in some cases, just listening to a ‘friend of a friend’ can lead you into investing cash that you really can’t afford to lose.
You might have heard of Boiler room scams – these scams often start in a similar way to ‘friend of a friend’ recommendations. If in doubt, take professional financial advice, and question the motives of anyone who tells you that you can’t go wrong if you invest in anything unusual.