Clubs and groups
Sometimes the clubs are exclusive and the allure of an investment opportunity just for them makes it extra attractive.
How is it done?
Spending a lot of time with a group or club, people talk about more than just the activities at hand. They become close and gain trust in one another. All members of a group or club have something in common—interests, hobbies, goals or values. Some clubs, like a sports club, may promote ethical play, so when a member is good at the game, others might think they are a person with integrity and good morals, and they can use this to their advantage.
Fraudsters can use what is the common thread of the group to lure people in all at once, as members of the groups or clubs often have similar social and economic situations. Con artists will often promote their scheme by befriending a respected member of the group. Once fraudsters gain the confidence of a distinguished member, they are introduced to others who are interested in investing. Scammers go through clubs and groups, hoping members will drop their guard.
Who are the victims?
The victims may be anyone associated with the club, and even their friends. Once one member starts promoting it to the others, they are all at risk. The victims can be of any wealth level and age.
Report it
Even if you are not considering an investment or haven’t given your money to a person selling the investment, take the time to bring suspicious activity to the attention of securities regulators. Your care and attention may save a friend, family member or member of your community from falling victim to a scam artist.
In BC, contact BCSC Inquiries. You can also anonymously report suspicious activity through InvestRight’s Report a scam webpage.
Residents from other Canadian provinces can find contact information for their provincial securities regulator at
www.securities-administrators.ca.