BCSC research finds that one-in-eight British Columbians over 50 vulnerable to investment fraud
In support of Fraud Prevention Month, the British Columbia Securities Commission (BCSC) Chair and CEO Brenda Leong today announced the results of research commissioned by the BCSC into the fraud vulnerability of older British Columbians. The research, conducted by Innovative Research Group, surveyed 800 British Columbians aged 50 and over.
“Our survey results show that what investors think, feel, and do matters when it comes to investment fraud vulnerability ,” said Leong. “This means thinking about investments the right way, feeling confident and financially secure, and taking steps to avoid risky situations.”
Key findings from the survey include:
- One-in-eight British Columbians over 50 are vulnerable to investment fraud. When presented with an investment opportunity that guaranteed 14% to 25% monthly and no risk, 10% said they would either look into it further and 3% said they simply didn’t know, suggesting they are not sure enough to reject the offer.
- Nearly two-in-five British Columbians over 50 (37%) are afraid of running out of money during retirement. This proportion is significantly higher among those vulnerable to fraud (49%) and those who have been past victims of fraud (47%). It is also higher among those with no savings (51%) and women under 65 (51%).
- Only 44% of respondents have a reasonable expectation of annual returns on investments. When asked about annual rates of return, less than half of the respondents expected a rate of return of less than 6% (The five-year average nominal return between 2010 and 2014 on a portfolio containing three common investment types – three-month Treasury bills, Canadian bonds, and Canadian equities – was 5.98%).
“The BCSC sees the damage caused by fraud up close. Our Be Fraud Aware campaign is designed to raise awareness and empower the public to recognize, reject and report investment fraud,” said Leong. “Our survey offers new insights into three significant factors that continue to make older British Columbians vulnerable.”
A random probability sample of this size has an estimated margin of error of +/-3.5 percentage points, 19 times out of 20. The estimated margin of error will be larger within each sub-grouping of the sample.