According to North American Securities Administration Association, there are millions of cases each year where frauds have sucked away every penny from investors worldwide. And with more people indulging in investments nowadays, these numbers are predicted to get even higher.

American trial attorney Robert Pearce has more than four decades worth of experience handling state and federal court securities litigation issues and Financial Industry Regulatory Authority arbitration proceedings. He is also a Boca Raton securities litigation attorney, a practice law that focuses on representing investment fraud cases and investors in stockbrokers.

Due to his extensive training and years of practice, he has been successful in defending many stockbrokers over the years in enforcement proceedings brought by the United States Commodities Futures Trading Commission, Financial Industry Regulatory Authority, and Securities and Exchange Commission.

With the growing number of cases each year, it has come to Pearce’s attention that investors need to be more aware of how investment frauds work and how to save themselves from being a victim of it. Hence, he has shared a few tips to help people in business feel safer regarding their investments.

Asking Questions

Whenever a fraudster is approaching you, the first and foremost important thing you need to do is to make sure you ask them a lot of questions. They will be hoping for you not to ask them many questions, but you can fend them off by digging into the details of what they are offering you.

Research and Then Invest

You need to take your time into research before taking the risk of investment- meaning that you shouldn’t solely depend on message board postings, new releases from companies, and unsolicited emails for your final decision on the investments.

An essential part of the research is looking into what the company is all about; their business services or products. It helps to know how authentic a business is to know exactly what you are getting into.

High Return Deals Are Suspicious

One of the most common things a fraudster would try and talk you into is either opening up an IRA together or buying a specific stock which will result in immense returns on the investment.

However, if these returns are much higher than what is usually produced in other investments within the same market, the chances are that you are being scammed. As stated by the First Alliance, “Fraudsters can entice others to buy products that will never arrive, or invest in easy and ‘profitable’ opportunities that will never come to fruition. These scams can be hard to distinguish from real purchases and opportunities because the cyber-criminal may use templates and contact information that looks real, and sometimes they’ve even gotten hold of your personal information to ‘prove’ that they are legit.”

It can be difficult for the first few times to figure out whether you are being scammed or not. But remember- most fraudsters follow a similar pattern when approaching new investors. If you keep the above tips in mind, you will hardly ever experience being a victim of their crime.