Learn to recognize the warning signs of investment fraud to better protect your financial future. If you take a look at the website of the fictitious company that we created, BlueHedge Investments, you will notice some of these common red flags.
Guaranteed high returns,
There is no such thing. All investing involves some level of risk.
Usually, the higher the return, the higher the risk.
Used to attract those looking to recoup other financial losses.
High pressure sales tactics
to invest right away.
Phrases like “Invest Now” are used to prompt an immediate decision.
VIP and exclusive membership opportunities make you feel part of an elite group.
(e.g. login buttons and “Contact Us” pages).
Particular dates and short time frames indicate a limited time offer.
High pressure sales tactics dissuade you from getting a third-party opinion.
Tax-free and offshore.
Promises of tax breaks appeal to many. You may be able to reduce taxes, but you can’t avoid them.
Explanations that money is going offshore can make you feel like a savvy, worldly investor. However, once offshore it’s hard, if not impossible, to get money back should something go wrong with your investment.
Slick appearances that don’t measure up.
Website asks for your contact information but doesn’t give theirs.
Misleading photos and images aimed to appeal to your dreams and emotions that don’t truly represent the investment opportunity.
Ads and website look professional, but a closer review reveals spelling and grammar mistakes.
Lack of quality information.
Buzz words or market trends lure you in as you feel you are part of something "big"
(e.g. green energy).
Language or complex diagrams baffle you with technology jargon.
Looks impressive, but gives little detail about what the investment is about – lots of words that don’t say much.