There's no doubt that investment fraud is on the rise and that older investors are a prime target. According to a 2010 Investor Protection Trust Survey, it's estimated that one in five seniors over the age of 65 has been taken, which adds up to 7.3 million in the U.S. alone. One way that perpetrators attempt to reach retirees and seniors is through "cold calling," or reaching you through an unsolicited phone call.
During these unsolicited phone calls, the investors are told about supposedly "low-risk, high-return" investment opportunities, and they often try to entice victims into rolling their existing retirement accounts into the opportunity. Often, the calls become increasingly harassing in hopes of wearing their target down and getting them to agree.
Here are a few things you can do to help your parents protect themselves:
It's hard to say. Scammers get lists of telephone numbers to try through a variety of avenues, and it can be very difficult to avoid them. Sometimes these scams will lift phone numbers from the local phone book. Sometimes they obtain phone numbers through other companies, like your credit card company. Sometimes they may have even obtained your number through a form you filled out -- like a request for more information or a contest entry.
It is very unusual for any legitimate investment opportunity to come to you through an unsolicited investment phone call, unknown email or social media message. If you are in doubt, however, remember that these types of phone scams almost always have these three things in common:
As the expression goes, “evil grows in the dark” and perpetrators thrive on isolation. Talking to your friends and family and trusted advisors and educating yourself through legitimate organizations can prevent you from becoming a victim to telephone and online scammers.
To help prevent cold calls, you can add your number to the National Do Not Call Registry. Despite this, you may still receive some telemarketing calls or calls touting investment opportunities.
If this happens, remember that you:
Cold calls about investment opportunities are one of the ways that people get involved in fraudulent investment schemes. The callers often are reading from impressive scripts that might sound a little too good to be true; however, your concerns are quickly quelled by a list of impressive facts, credentials, and perfectly placed reassurances. It all sounds very good.
Scam artists are well-rehearsed, leading unwitting investors into fraudulent schemes that can end up costing them a fortune. Here is a list provided by the NASAA Investor Education Site on how to avoid being a victim of cold calling investment fraud:
Protecting yourself and your retirement funds from senior investment fraud is becoming increasingly difficult in a world where scammers are specifically targeting seniors. Remain vigilant, always ask for details in writing, do your research, and meet in person before putting your cash on the line. If you have already been the victim of investment fraud, speak with one of our skilled investment fraud attorneys today. Meyer Wilson is devoted to helping victims of senior financial fraud recover their losses through mediation, arbitration, and litigation.