InvestRight

Recognize it

Scam artists take advantage of the intrinsic trust within a close group in order to orchestrate an investment fraud. This is called affinity fraud. If you hear a friend or family member 'talking up' an investment, be wary. Sometimes they do this because they are earning great returns, and other times it is because they are getting a commission for bringing in new investors. Often they don’t know it is a scam, but when it collapses, friendships and family relations often suffer irreparable damage.

Check it out

Protect yourself from this type of fraud by using this checklist and visiting the Fraud among friends section of our website:

	Be suspicious Investments described as exclusive or only offered to a particular group often turn out to be scams.
	Watch out for investments or advisors who exploit a personal connection Research backgrounds and credentials, and understand the investment.
	Beware of referrals from “trusted” members within your group They could have been selected by the scam artists as early influencers.
	Don’t be drawn in by promises of spectacular returns and low risk short-term returns might come from someone else’s initial investment and could disappear when there are no new investors.
	Get a prospectus or other written information Ask for detailed written materials outlining the nature of the investment, the risks involved, financial statements, and any withdrawal or trading restrictions.
	Do your homework Just because an investment or company has been around for awhile, doesn’t mean it is safe. Some investment scams take time to get off the ground.
	Check out the promoter and the investment Determine if the salesperson is registered to sell securities by conducting a registration search.
	Consult with a person independent of the deal Paying an independent lawyer, accountant, or financial advisor may save you a lot of money down the road if the investment turns out to be a scam.

Also, check out the Protect your money section.

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.