The Face of Investment Fraud
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Research has shattered the stereotype of investment fraud victims as isolated, frail and gullible. The truth is, we're all at risk. Victims of investment fraud are most often male, financially literate, college educated, and approaching or in retirement, but almost anyone who invests is a potential fraud target.
A survey by the FINRA Foundation examined how known investment fraud victims differed from non-victims. Among its key findings, the survey identified several investment fraud risk factors, including:
- Owning high-risk investments (for example, penny stocks, promissory notes, futures, options or private investments in foreign currency);
- Relying on friends, family, co-workers for advice;
- Being open to new investment information;
- Failing to check the background of an investment or investment professional; and
- Inability to spot persuasion tactics used by fraudsters.
You can reduce your vulnerability if you know what to guard against. Get to know the red flags of fraud.
Listen to real stories of investment fraud from the victims themselves.