Fraudulent Investment Schemes

Fraudulent investment schemes can be some of the hardest forms of fraud to detect. Their perpetrators typically are sophisticated brokers, stock promoters, advisors or operators who give the appearance of being legitimate professionals, often with extensive knowledge of the financial industry and excellent manners. Unfortunately, the perpetrators of investment scams often prey upon the elderly due to their reputation for being trusting of others. Fraudulent investment schemes, when perpetrated against the elderly, are a form of financial elder abuse that often result in the loss of significant sums. If you or someone you care about has been the victim of an investment scheme, a California financial elder abuse attorney can help you recover. 

Common Fraudulent Investment Schemes Targeting the Elderly 

Investment scammers have many tools in their arsenal that are designed to separate victims from their money. While they are always coming up with new ways to accomplish their mission, some of the most common types of fraudulent investment scams include: 

•   Ponzi schemes: These occur where the perpetrator creates the illusion of a lucrative investment by paying returns to old investors from the proceeds of new investors. Once new investors stop coming in, the scheme collapses, and the investors lose their money.
•   Boiler room schemes: These occur where the perpetrator cold calls victims and uses high-pressure sales tactics to entice them to invest in fictitious assets
•   Oil, gas, and gold schemes: These occur where the perpetrator persuades their victim to invest in a new oil, gas, or gold venture with promises of high rates of return
•   Offshore investment schemes: These can take many forms, but they generally involve the perpetrator persuading the victim to send money out of the country, where it will be harder to trace and recover

Large investments ina fraudulent investment scheme can have devastating impacts on their elderly victims, including loss of their nest eggs. 

How to Spot an Investment Scam 

Seniors can help to protect their assets by keeping the following guidelines in mind: 

1.     If it seems too good to be true, it probably is. Compare the promised yields with current returns on well-known investments. If the promised rate is significantly higher, be suspicious.
2.     Beware of high-pressure sales tactics. Legitimate stockbrokers and other investment professionals will give you time to think about your investment.
3.     Looks can be deceiving. Many scammers have slick-looking websites, brochures, and business cards that are merely a veneer of legitimacy.
4.     Have a professional or sophisticated investor look over the statements you receive.  Some fraudsters (particularly in Ponzi schemes) create fake statements, which a professional or savvy investor can probably spot.
5.     Read through the jargon. Many scammers use complicated explanations and complex jargon to hide the true nature of their “investment opportunities.”
6.     Legitimate professionals rarely make cold calls. If someone you do not know approaches you unsolicited with an investment opportunity, treat it as a red flag. 

Fight Back Against Investment Fraud With Help From a San Francisco Financial Elder Abuse Lawyer 

If you believe that you’ve been the victim of a fraudulent investment scheme, you need an experienced attorney on your side who can help you prove your case. For more information, please contact a California financial elder abuse attorney at the Evans Law Firm, Inc., by using our online contact form or calling 415-441-8669 or toll-free at 1-888-50EVANS (888-503-8267).