Good investment opportunities are something that everyone wishes to find and taking advantage of such an opportunity, fraudsters end up creating new types of investment opportunities just to trap a new innocent investor and then vanish in thin air with his or her money. Some of the most common investment scams are as below.
What these scammers do is take advantage of the traits such as avarice that one possesses. They ask the traders to start investing small and show that they have made a lot of profits within a week or so. Soon they win over their trust and then ask them to invest a lot more. Once they invest a lot, they run away with the traders money and no longer entertain their phone calls and other stuff.
The other type of investment scam is the advance fee scheme. The victim is often asked to pay money upfront to take advantage of a lot of returns at a later stage of the monthly investment process. The catch here is that the broker will take the money and then run away soon after. The scammers usually go for the investors who have lost money recently. They will contact the investor and offer them help by recovering the losses. They will say stuff like they can buy or exchange stocks or cryptos on their behalf but for that they first need to pay an upfront fee. It is that very place where the investors lose the money at one go.
Often you will get unsolicited males stating about an investment that is going to provide you with a lot of profits. You click the link where it leads to a message that leads to a particular website where it asks you to input your details. Some input the basic details, the gullible ones end up giving the credit card details as well. Then they steal their details and sell it out in the open. The investor ends up being a victim of identity theft.
This scam targets individuals who have had a lot of retirement savings in a Locked In Retirement Account (LIRA). Usually, such an account doesn’t allow money withdrawals for a certain period of time, like until you reach the age of 55-60 as such. In the majority of the cases, there are limits on how much money you can take each year and for that, you have to pay taxes as well.
What these scammers do is that they promote ads all over the internet where you can be exempted to pay taxes on your locked in amount by buying shares for a particular company. For that you need to take a loan. To get that loan, you must sell your investments and hold in your LIRA and use the money to buy the shares of the company the investor is telling you to. In return, the scammer promises a loan return of approx 60% -70% on the money that is being invested. They will keep the rest as a fee for all the work that has been done. You will often be told to pay the amount by cash so that the tax official doesn’t doubt you at all. Unfortunately, the investment will actually be pretty worthless as you might never see the loan going through and all your retirement savings would be lost.
Ponzi and Pyramid Scheme
This works on the networking basis where the majority of the scammers will hire one individual and ask that particular individual that he or she is only going to receive a profit if and only if he could sign up new investors for that particular scheme. Then it goes on and on and on. Investors keep on piling up. They receive the initial profits and soon, it is Soon, the scam is usually busted and the original investor vanishes all the money that they have earned.
Just stay safe with your money and invest wisely.