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Investment Scams Targeting Seniors
Seniors should be aware that they're a favorite target of investment scams. Many of these scams are pitched as legitimate investments and business opportunities during free luncheons and seminars.
Seniors are finding themselves the target of more and more scam artists because so many people 65 and over
have accumulated assets intended to help them maintain their lifestyles throughout their retirements.
Volatile stock markets, low interest rates, rising health care costs, and increasing life expectancy,
combine to create a perfect storm for investment fraud against senior investors.
Older investors are being targeted with increasingly complex investment scams involving unregistered
securities, promissory notes, charitable gift annuities, viatical settlements, and Ponzi schemes, all
promising inflated returns.
How to protect yourself or your loved one:
- Don't let scare tactics cause you to make a hasty decision to lock up your money in an illiquid investment.
- If there really is something to worry about, take the time to consult with trusted family members and advisors to see what options are available to you.
- Make sure you understand what the costs of the investment are, how much the person selling it will be paid if you buy, and any restrictions or costs that might limit your ability to get your money out if you want or need to.
- Check to see if the person selling the investment is licensed with the Securities Division.
- Check to see if the investment is has been registered with the Securities Division or Securities & Exchange Commission.
Free Lunches and Seminars
Many seniors are being targeted with dubious free lunch or dinner seminars advertised as "educational."
A yearlong study of free-meal investment seminars by state securities regulators across the nation
highlighted the abusive tactics sometimes employed by seminar sponsors. Out of 110 supposedly "educational"
seminars examined, all were actually sales presentations. Half of the seminars featured exaggerated or
misleading claims about the performance of products being offered. Thirteen percent of the seminars were
completely fraudulent.
How to keep from getting suckered:
- Look at your alternatives before investing.
- Talk with trusted advisors or family members.
- Just because a sales agent did you a small favor, such as providing a meal does not mean you have any obligation to invest. Evaluate any investment offered on its merits, not on whether you received a favor from the seller.
- Ask what firm the presenter represents and what products he or she sells.
- Remember there are no free lunches.
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