How to Detect Investment Fraud

Who is a subject of Fraud? All of us, however the perpetrator of a fraudulent act are targeting a set group of individuals. It used to be that the stereotype for investment fraud were isolated, frail and gullible, however, these are not the only ones being targeted. The emphasis has now shifted to the Baby Boomers, who have acquired, security, a nest egg for the future, and property. Today the perpetrators are seeking self reliant individual when it comes to making decisions, those who are above average financial knowledge, above average income, College-educated, eperienced a recent health or financial setback, and those who are willing to listening to new ideas or sales pitches. Sounds like someone you would know?

The psychology of running a scam, "If it sounds too good to be true, it probably is. Fraudsters are masters of persuasion, tailoring their pitches to match the psychological profiles of their targets. They look for your weaknesses by asking seemingly benign questions, about your health, family, political views, hobbies or prior employers. Once they know which buttons to push, they'll bombard you with a flurry of influence tactics.

Even if you have never been subjected to an investment fraudster's sales pitch, you probably know someone who has. However you can help protect your family and friends by recognizing how investment fraudsters operate and reporting suspicious sales pitches and actual scams. Protect yourself, take the take the time to stop and think before making a decision.

1. End the conversation: Practice saying "No." Simply tell the person, "I am sorry, I am not interested. Thank you." Knowing your exit strategy in advance makes it easier to leave the conversation, even if the pressure starts rising.

2. Turn the tables and ask questions: A legitimate investment professional must be properly licensed, and his or her firm must be registered with the Securities and Exchange Commission or a state securities regulator. Don't be afraid to ask where their license is and before you make an investment tell them that you are going to check them out. Do not be pressured into making a decision on the spot.

Disclosure Database (800) 289-9999 www.adviserinfo.sec.gov

North American Securities Administrators Association at www.nasaa.org or (202) 737-0900

3. Before committing to anything, talk to someone first. Even if the seller and the investment are registered, it's always a good idea to discuss these sorts of decisions with family or a trusted financial professional.

4. Take Your Name Off Solicitation Lists

One easy step you can take to reduce the number of sales pitches you receive is to take your name off of telemarketing and junk mail lists. Here's how to cut out some of the clutter:

• Telemarketing Calls www.donotcall.gov or call toll-free (888) 382-1222

• Credit Card Offers www.optoutprescreen.com or call toll-free (888) 567-8688