If it sounds too good to be true, then chances are it isn’t true. Simple rule to follow right? If only, because sadly year-after-year, Canadians continue to fall for investment scams. They may be pitched an opportunity to earn high returns that are guaranteed and risk free. Or, the investment is off-shore and tax-free. Maybe their friend or family member told them about it and says they’ve received statements showing the promised return. How about the promise that there’s a secret way to profit like the ‘pros.’
These are some of the common methods scam artists use to entice people to invest in their schemes.
For example, in one case, BC investors were pressured by boiler-room sales techniques into putting money in an investment that promised returns of more than 400 per cent by year three of their investment. This is just one of the many cases highlighted in the CSA’s 2011 enforcement report.
When it comes to investing, don’t accept promises without doing your homework. Visit InvestRight.org to learn what you need to know.