Call Now For a Free Consultation:
(614) 532-4576
Nationwide Representation

5 Red Flags of Investment Fraud

  • Guaranteed riches. An opportunity that promises "guaranteed" returns should always be taken with a grain of salt. An opportunity that promises "guaranteed" returns that are significantly higher than the market average is a definite marker for investment fraud. Remember: Things that seem too good to be true are, in fact, too good to be true. No one can promise you guaranteed, high yield returns in good faith – they simply don’t exist. If you want a high yield product, you’re going to have to pay for it with added risk. Anyone who says otherwise is out to con you.
  • "Hurry – this offer won’t last long." Scam artists are experts at using a sense of urgency to push otherwise wary investors into shady investments and/or downright frauds. Any person who insists you have to act now, regardless of the reason, wants to ensure you don’t have time to think about the investment or investigate it. Insist on taking the time you need to do your research. With the plethora of investment schemes out there, it’s better to be safe than sorry.
  • Vague answers and/or flimsy (or non-existent) documentation. Before you part with your hard-earned money, you should understand why you’re parting with it and where it’s going. Ask questions, and make sure you get an offering statement, a prospectus, or some other form of documentation that describes the investment strategy, the risks and benefits, and the details (fees and costs, liquidity restraints, etc.). If you can’t get the answers you need, walk away. Whoever is pitching the "opportunity" to you is being vague on purpose.
  • Dropping names. Affinity fraud is popular among con artists, and they’ll often try to build trust with prospective investors by gaining the trust of other prominent figures in the investors’ community. If the main pitch for an investment opportunity is that your pastor, your neighbor, your boss, your mother, or a well-known celebrity is "in" on the investment too, double your research efforts. The name dropping is likely a cover-up for investment fraud.
  • Glamorous or expert credentials. Recent con artists have used their purported backgrounds as CEOs, vice presidents, and other big-name positions to drum up business and inspire trust. One alleged fraudster even used his status as an ex-FBI agent to attract investors. Don’t take anyone’s word as proof of his or her expertise. Do your own research to make sure you don’t get taken in by a fast-talking con with a glamorous, but bogus, resume.
The information contained in The Firm’s posts on its blog, fraud alerts, investigations or elsewhere on the site is based upon information obtained from other sources including, but not limited to, news outlets and federal, state, and regulatory agency filings. All suspects and subjects of postings herein are presumed innocent until proven guilty in a court of law or administrative action and any and all crimes are alleged until a court or regulatory agency finds otherwise .

Share This Story
If you found the information provided by this article useful, consider sharing to your social media channels to help others in their search for reliable resources.
Consult with Our Legal Team
There is never a cost associated with a consultation
Atlanta Office

945 East Paces Ferry Road, Suite 2275
Atlanta, GA 30326
Columbus Office

305 W. Nationwide Blvd
Columbus, OH 43215
Meyer Wilson
New Orleans Office

900 Camp Street 
Suite 337
New Orleans, LA 70130
Los Angeles Office

2029 Century Park East,
Suite 400N
Los Angeles, CA 90067
Cleveland Office

4781 Richmond Rd.
Suite 400
Warrensville Heights, OH 44128
Bloomfield Hills Office

41000 Woodward Ave.,
Suite 350
Bloomfield Hills, MI 48304
Quick Links
The information contained in this Website is provided for informational purposes only, and should not be construed as legal advice on any subject matter. No recipients of content from this site, clients or otherwise, should act or refrain from acting on the basis of any content included in the site without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from an attorney licensed in the recipient's state. Read More
The information contained in this Website is provided for informational purposes only, and should not be construed as legal advice on any subject matter.
Read More
chevron-down linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram