Before committing to any investment opportunity, it is important to be aware of critical fraud warning signs so that you don’t fall prey to a scam artist. If an investment you are interested in has the characteristics of one of the five warning signs below – it is okay to say ‘no.’
- No Risk – There is no such thing as a guaranteed investment: the higher the returns, the higher the risk. This type of sales pitch is often aimed at people who live on a fixed income or those near or in early retirement who are worried about not having enough money in retirement.
- Profit Like The Pros – These scams are pitched as opportunities known only to a select few who are said to be making a lot of money. The scam artist convinces you that he or she has access to this inside information.
- Offshore, Tax Free – Fraudsters pitch this scheme as a way to avoid paying taxes. If you agree to it and move your money outside Canada, it will be out of the reach of Canadian authorities which is exactly what the fraudster wants.
- Get In Now – Scam artists use this tactic to pressure you into making a quick decision. In this scheme, a fraudster will suggest that they have secret information that the general public doesn’t have.
- Your Friends And Family Can’t Be Wrong – Scam artists target religious, ethnic, or close-knit groups by working their way into organizations and befriending members. This approach relies on the trust you place in the people that you care about.
When an offer sounds too good to be true, it likely is. Before investing, always make sure that the person soliciting the investment is a registered investment advisor. You can check to see if they are registered through the Canadian Securities Administrator’s Check Registration website.
If you are concerned or have questions regarding an investment opportunity, do not hesitate to contact BCSC Inquiries at 604-899-6854 or 1-800-373-6393, or through email at [email protected].
This post is about how to check in with your investment portfolio and why it's important. It also contains information about reporting investment income when filing your income tax return, and changes to tax deadlines due to COVID-19.
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