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INVESTMENT FRAUD
Since the invention of the telephone, "get-rich-quick artists" have
telephoned large numbers of people for fraudulent promotions. Over the years,
their sales techniques have become polished and sophisticated. As the schemes
have become more complicated, the true nature of the so‑called investments has
been deeply hidden, but fraud against investors is the real goal.
Listed below are some precautionary measures to use when considering
investments:
- Do not deal with any securities dealer or its representative unless
you know that both the firm and the representative are licensed under Wisconsin
securities law.
- Do not give out personal information such as your Social Security
number, your financial condition, your past investment history, or your bank,
credit union or savings and loan account information unless you feel confident
about dealing with the salesperson or the firm. If you give a caller such
information, a claim may later be made that you authorized a transaction,
otherwise why would you have given the caller such information?
- Require that written information about the investment be sent to you
before you make any investment decision. Have the information sent by U.S.
mail, not by a private courier service (such as UPS or Federal Express). After
you receive the information, seek the opinion of a brokerage firm, accountant,
attorney or someone you trust who is knowledgeable about making investments.
- Do not let a salesperson use high pressure or hard sell tactics to
convince you to make a purchase. They will use all the current industry slang
and, if necessary, will even invent more in order to sound as if they know more
about the prospective investment than you will ever need to know. Many will say
"trust me" … don't!
- Never agree to any part of the investment regardless of what the
salesperson says. Wait until you have received all the requested information by
U.S. mail, and have had time to evaluate it, before giving the caller any
indication of possible interest.
- Feel free to hang up the telephone if someone continues to pressure
you. You do not owe this type of salesperson any explanation. You did not seek
them out; they sought you out.
The majority of this information was provided by the
Department of Financial Institutions. Please link to their web site for
more in-depth information about investments and educational resources.
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