SASKATOON – RCMP investigations, the Saskatchewan Financial and Consumer Affairs Authority (FCAA) and local police are joining forces to educate the public throughout March about scams seen across the province for Fraud Awareness Month.
One area fraud investigators are focusing on is the high number of reported incidents where investors suffered substantial losses after victims were convinced to buy into “high rate of return” products.
Individuals who are retired, planning or are on fixed income investments could be tempted to move away from slower growing investments to alternative products without understanding the risks and dangers involved.
A very common sales pitch given to older victims could go like “the clock is winding down on the time for you to build up your retirement funds, and at the presently low interest rates, you will fall short of money to retire on. To ensure that you will be able to live a comfortable retirement, you need to make more money now!”
These offers usually stress urgency and say it is only available for a limited period of time. This convincing argument often results in victims leaping at the offer without fully investigating the source or the risk.
More times than not, this action will end with victim’s entire savings lost.
The FCAA reminds investors to consider the following when making investment decisions:
- Get as much written information about the investment as possible and be sure to take the time to understand the investment.
- Ask questions if the information is unclear, and get opinions from persons who are independent from the person trying to sell the investment such as professional advisors, bankers, accountants, lawyers, trusted friends or family members.
- Is the rate of return realistic? If everyone else is offering 3 per cent why is this person able to offer 9 or 12 or in some cases 25 per cent?
- Is this salesperson registered to sell investments in Saskatchewan and is this investment qualified to be sold in the province. Call the FCAA to check.
- Search the internet to see if there are previous problems with the company or person selling. Remember, just because there is a website does not make the investment offering legitimate. Many scams have very professional looking websites created to mislead victims.
All investments carry a certain degree of risk and that level is normally related to the expected return. Higher yields generally carry high risks while low risks equate to lower returns.
In the coming weeks, Fraud Awareness Month will focus on ransomware, online vehicle scams, identity theft and romance scams.
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