Social media tools such as Twitter, Facebook, and LinkedIn are accessible, interactive mediums where dialogue can take place and information shared. These tools can provide benefits for investors looking for information about investing, but it can also provide opportunities for fraudsters looking to promote an investment scheme.
Using social media, fraudsters can contact many different people at a relatively low cost – they can create fake accounts, e-mail addresses, and link their posts to a website, videos, or photos that make the investment look legitimate.
The potential of anonymity on social media can also make it difficult to identify or find fraudsters using this medium to promote a scheme.
If a scheme catches on in social media, people who think the investment is legitimate may encourage others in their network to invest. This can result in many friends, family members, and colleagues investing in and then promoting an unsuitable or fraudulent investment. If the investment fails or is fraudulent, money is lost and personal relationships affected.
What can investors do to protect themselves on social media?
- Be wary of unsolicited offers to invest.
- Look out for the investment warning signs. If it is too good to be true, it probably is.
- Be wary of investment offers that your friends and family are talking about or promoting on social media.
- Be meticulous about privacy, passwords, and security settings.
- Ask questions and research all information about the investment and the people promoting it.
If you are thinking about investing and have any questions, do not hesitate to call BCSC’s Inquiries Group at 604-899-6854 or 1-800-373-6393 or through e-mail at [email protected].
BCSC staff placed 24options.com, GOoptions.com, and TradeRush.com on its Investment Caution List (ICL) on Aug. 7, 2013. The websites offer online trading platforms for binary options, a type of investment product that trade in currency markets. The payout for this type of option depends on whether the underlying asset (such as a stock, a commodity, […]