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Investment Fraud: what can you do to avoid becoming a victim?

Servus Credit Union members work hard for their money; we would like to provide you with some investment tips to ensure that your hard earned money is not lost.

A recent Canadian Securities Administrators Survey indicated that almost 1 in 20 Canadians has been a victim of Investment Fraud.

Always check the credentials of the individual or the firm that you are investing with. Is the person or company registered with the Alberta Securities Commission? (albertasecurities.com)
Do not rely solely on the Internet to get your information on an investment or company, but rather call some reputable companies in your community and ask their opinion as well.
If something sounds too good to be true, it likely is. Ask yourself why you are being offered this chance of a lifetime.
When dealing with investments offshore or third parties use extreme caution do not let anyone pressure you into sending funds or signing documents without thoroughly doing your homework regarding the investment, the laws of the country you are dealing with, and the people claiming to be working with your best interest in mind.

Red Flags to watch for (From the Alberta Securities Commission)

Promises of high returns with little or no risk. There is no such thing. Usually, the higher the returns, the higher the level of risk.
Pressure to invest immediately or miss the opportunity. Don’t be pulled in. This tactic is used to pressure investors into handing over their money without doing their homework or asking for independent advice.
Offshore investment – tax-free. Taxes can be deferred, but they can’t be avoided. This tactic is used to get investors to send their money offshore where it is difficult, if not impossible to get it back.
Great investment opportunity – your friends can’t be wrong. Yes, they can. Roughly half of all successful investment fraud is introduced to the victim by someone they trust. Sometimes these trusted individuals are also unknowingly a victim of fraud. Check out as much as possible about the person who is selling the investment (no matter how trustworthy you think they may be) and the investment itself before you invest.

How to protect your Money (from the Alberta Securities Commission)

Don’t be afraid to ask questions and make sure they are answered to your satisfaction
Take notes during conversations with sales people
Beware of high-pressure sales tactics
Take your time to make decisions. Don’t allow anyone to rush you
Always seek independent financial advice or see a lawyer if you don’t understand a document
Never accept a verbal agreement – get it in writing
Never sign any document before reading it carefully
Don’t be drawn in by appearances – fraudsters know the importance of first impressions

If you have questions regarding an investment that you are considering one of our investment specialists would be happy to help you get the answers you need, please call your Servus Credit Union branch or our Call Center @ 1.877.606.6333.

Beware of Scams:

http://www.cra-arc.gc.ca/nwsrm/lrts/2008/l080818-eng.html

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