As noted elsewhere on this site, a recent survey* found that 41 per cent of Nova Scotians believe they have been approached with some form of investment fraud. What else do we know about investment fraud in Nova Scotia? You might be surprised.
- Of those approached with investment fraud, 25% say they have been approached five or more times.
- Only 29% believe investment fraud is common in their province.
- Only half of Nova Scotians believe they are as likely to be a victim of fraud as anyone else.
- 81% believe it is important to report even the suspicion that someone has approached them with an investment fraud.
- Less than 1/3 of those approached actually reported the attempt.
- 81% believe you should never make an investment without doing independent research. Yet almost half (48%) rely completely on the advice of an adviser, doing no research on their own.
- You do not need to be rich to be a fraud victim – most Nova Scotians are defrauded for $5000 or less, often less than $1000.
*All stats taken from the CSA Investor Index 2009.
Want to learn more about Investment fraud – play our Go Fraud Free ~ Win a Wii contest. Enter by commenting on any of our blog posts, or answering our daily trivia questions on Twitter.
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In the recently released CSA Investor Index 2009, 41% of Nova Scotians reported that they were approached with a possibly fraudulent investment. One out of four said they were approached five or more times with a potential investment fraud.
With fraud attempts so prevalent, how can you work to protect yourself? To start, you want to be familiar with the Red Flags of Fraud – five signs that an investment opportunity might be fraudulent or inappropriate.
To help investors become more familiar with the signs of fraud, and more comfortable in their investment decisions, my colleagues at the Alberta and BC securities commissions have combined forces to provide an online tool to help you learn how to protect your money.
The interactive tool entitled Investment Scams: How to Protect Your Money, focuses on some common methods that fraudsters use to approach potential victims – via friend and family or ‘affinity’, the Internet, seminars and advertisements. The online resource engages users with an opening quiz and testimonials to raise awareness of the ways fraudsters attract their victims. The testimonials are based on real cases depicting how people are drawn into scams.
The comprehensive tool provides information about how to recognize, research and prevent fraud. Offered as modules that can be easily accessed and shared, the resource provides investors with checklists and tips to help them evaluate and research investment opportunities for risks and potential fraud. As well, there are features within the resource to help investors directly email questions to a person offering them an investment and submit a complaint to the securities regulators.
To try it out for yourself, visit the site of either the Alberta or British Columbia Securities Commissions. Some of the information presented will be specific to those provinces. To see how the same might apply in Nova Scotia, contact me, or pose a question in the comments below.
Also available, from the Alberta Securities Commission, is a similar tool Who’s Taking Care of Your Money? This online course guides you through the process of choosing and working with a financial adviser. For both novices and experienced investors, it includes information on managing your relationship with your adviser, and how to file a complaint if needed.
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