Consumer Publications List
a few minutes, an unscrupulous con artist or fast talking 'financial advisor'
can swindle an unsuspecting consumer out of a nest egg that took a lifetime to
build. Unlike muggers and thieves, investment fraud artists don't take your
money against your will; they persuade you to hand it over willingly.
Here's how one
convicted con man describes the way he targeted senior citizens: "...The key
is to become friends with the victim first. I always talked to someone several
times before ever asking for a sale. I asked them about their life, listened to
their stories, kept them company, flattered them. 'Edie, you couldn't possibly
be 75 years young. Why my wife is only 35 and you sound just like she does over
the phone!' Once they were my friends and trusted me, I could sell them until
they ran out of money..."
You don't have to
be rich to capture the attention of a con artist. Many of their prime targets
are older consumers with little or no experience investing money.
The most common way
for swindlers to victimize investors is through unsolicited telephone calls. You
can reduce the likelihood of falling victim by refusing to talk with unsolicited
callers, no matter how honest and reputable they sound. Should you receive a
call from someone you don't know, be very cautious and don't reveal any personal
or financial information.
use high-pressure tactics to force you into making a decision on the spot are
almost always pitching frauds. They're afraid you might figure out the scam if
you think over the investment, consult with your family or seek a professional's
advice. They may try to convince you that you'll lose a lot of money if you
hesitate and don't "'get in" right away.
Don't be pressured
into making a quick decision. Use your own transportation to any meeting that's
arranged, rather than depend upon the salesperson's. That way you can leave
whenever you want. Leave your checkbook and credit cards at home.
like to develop a false bond of friendship.They may offer gifts or unsolicited
financial advice to gain your trust. Never feel pressured to invest out of
courtesy. You're under no obligation to stay on the phone or remain at a meeting
with promoters, no matter how much time and effort they've taken to persuade you
to make an investment.
Beware of any
promoter whose investment presentation:
Preys on fear. Con
artists know senior citizens often worry about out living their savings or
experiencing a catastrophic event that could wipe out savings. They may say the
investment is a way to build up so much savings you won't have to worry.
return on your investment at little or no risk. Remember, the higher the return,
the greater the risk.
latest trend. Be skeptical of promises of instant profits, as in pyramid
schemes, where you must enlist others. Other recent frauds involve investments
in wireless cable or telecommunications licenses or stations, so-called 'prime
bank instruments,' precious metals and mines, international deals, and gas and
oil drilling ventures.
Pushes you to
invest money in a plan you don't understand.
testimonials you have no way to check out.
Get everything in
writing, review it thoroughly, and make sure you understand all the risks. Walk
away from any promoter who won't give you references and information in
Just because the
promoter has glossy, complicated-looking brochures does not mean the operation
is legitimate. To find out, you must check out the company. A financial expert
not connected with the seller should look over the information, give an unbiased
opinion and explain the investment to you.
Confirm that the
promoter is registered and in good standing. The Maryland Securities Division
(410-576-7784) maintains and has access to databases with this information. Many
investment opportunities must be registered in Maryland before sale, and
investment promoters must be licensed.
Association of Securities Dealers (800-289-9999) can also provide information on
brokers and financial advisers.
Stay in charge of
your money. Be suspicious of any planner who says,"leave everything to me."
Instead, insist on regular statements and monitor the activity on your account.
Ask lots of questions about activity on your account that looks excessive or
unauthorized. If the promoter makes excuses or stalls when you demand your
money, you may be dealing with a swindler.
If you suspect
something's amiss with your investment and cannot resolve your concerns, demand
your money and call the Securities Division immediately. Don't let embarrassment
or fear keep you from reporting fraud. The longer you wait, the harder it is for
the authorities to track down a con artist.
understand the panic you feel after a financial loss. It's the ideal time for
them to approach you again, promising a 'sure' way to recover your lost money.
Don't fall victim twice. For more information on avoiding investment fraud,
write: Securities Division, Attorney General's Office, 200 St. Paul Place, 20th
floor, Baltimore, MD 21202.
Maryland Attorney General's Consumer Protection
DivisionConsumer hotline: (410) 528-8662 or 1 (888) 743-0023 toll-free
200 St. Paul Place, Baltimore, MD 21202
410-576-6300 / En español 410-230-1712 / 1-888-743-0023 toll-free / TTY: Dial 7-1-1 or 800-735-2258