High-profile investment scams frequently target retirees because of their retirement nest eggs. Lately, investment scams are becoming more elaborate in the hopes of catching these victims off guard. Some new tactics include directly messaging consumers’ phones and capitalizing on the popularity of crowdfunding platforms.
In an ever-increasingly digital world, experts warn consumers to be constantly on guard for possible scams.
“It’s easier for swindlers to perpetrate fraud these days,” says Neil Gross, executive director of the Canadian Foundation for Advancement of Investor Rights, or FAIR Canada, in Toronto.
Not only are scammers starting to use messaging apps – sending stock spam right to potential victims’ phones – but Mr. Gross fears that the recent popularity of online crowdfunding platforms will result in many new victims.
Until recently, North American securities regulators told the public to be wary of investment opportunities offered over the Internet. But times have changed. Now some provinces and jurisdictions in the United States have modified their tune, saying that some forms of online crowdfunding are approved.
Mr. Gross says this “garbled message” does not warn investors that crowdfunding is “extremely high risk and potentially very dangerous. Securities regulators are unlikely to be able to police this effectively. We have the makings for a perfect storm of fraud,” he says.
For more tips on how to avoid investment scams, visit the Financial Consumer Agency of Canada.
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