Kim Johanson, contributing writer sedonaeye.com Senior Issues and Health Care

     Falling victim to a fraudulent investment scheme can mean losing anywhere from a few hundred dollars to your life savings. While most people might not see the harm in sitting through an investment seminar, the Better Business Bureau recommends researching the investment company first, rather than run the risk of falling for a financial scheme.

Investment scams and schemes can come in many forms, and a common technique to lure people in is the offer of a free financial seminar over a nice meal. In one recent example, the Securities and Exchange Commission shut down a Ponzi scheme that stole $20 million from retirees in California and Illinois. The scammers invited senior citizens to estate planning seminars and later coaxed their victims into buying promissory notes for purported overseas investments.

“Free meal seminars can seem harmless, but attendees run the risk of getting drawn in by the slick presentations and promises of big returns,” said Carrie Lorimer, BBB Director of Operations. “Unscrupulous seminars often use the promise of a free meal to lure in senior citizens who have time, retirement accounts and real estate.”

When listening to an investment pitch, BBB recommends looking for the following red flags:

• Requires a large up-front investment. This allows untrustworthy schemers an opportunity to immediately leave town with a large sum of money, rather than waiting for funds.

• Promises high returns for low risk. Every investment comes with a level of risk. Typically the amount of risk increases in line with the potential return on the investment. If the seminar is trying to sell an investment scheme that claims a high return with little or no risk, beware, even if it comes with the promise of a money-back guarantee.

• Employs high pressure sales tactics. Seminar leaders often use high pressure sales tactics to get people to sign up without thinking it through. They might claim there are only a few spots left or that you need to get in on the ground floor immediately to see the largest earnings. Any reputable investment company will let you take your time to do your research, and will not pressure you into signing a check.

• Relies on off-shore investments. Many swindlers try to give their scheme an air of sophistication by relying on overseas investments such as foreign currency, property, stocks and bonds. They also might claim – incorrectly – that you can avoid taxes by investing overseas.

• Sounds too good to be true. At the end of the day, if an offer sounds too good to be true, it probably is. Always listen to your instincts because the potential payoff is rarely worth the risk.

Article written by Kim Johanson, sedonaeye.com contributing writer Senior Issues and Health Care    Forward this helpful story to others by using the social networking options below!  Have a comment for Kim?  A subject matter of interest or concern?  Write Kim.Johanson@HomeInstead.com. To read more of Kim Johanson Senior health care and issue articles, go to the Search box and enter Kim’s name. Enjoy!