Common Investment Frauds Seniors Should Avoid
Seniors all over the world are some of the easy targets of all manner of fraudsters. In case you are 65 years or older and you are contemplating investing your savings, then you should read this post up to the end. We have highlighted some of the most common investment frauds that seniors are most likely to fall victims of. Check them out here!
- Advance fees fraud
Advanced fees fraud is a scheme involving persuasion of someone who wants to invest to pay some money upfront in order to take the investment opportunity that will generate high returns. As a senior citizen who maybe living on reduced income and limited resources, you might easily become a victim of advanced fees fraud. The main aim of the fraudster is to convince you to pay advance fees, which he or she will then take and disappear by ceasing all communication. For example, a fraudster may offer you an interest-free loan from a non-profit organization or an overseas bank on condition that you pay some a certain amount of money as an application fee.
- Pyramid schemes
Also sometimes referred to as ponzi schemes, pyramid schemes are another common investment scams that seniors should watch out for. A pyramid scheme is typically run by individuals and not companies. These individuals will recruit you via emails and ads that promise you a lot of money while working from the comfort of your home. This makes such non-existence investments attractive to senior citizens who are already retired and would not want, or are not able to look for another job. Most of them promise their targets quick returns.
- Land banking
Land banking is another common investment fraud that seniors must avoid. It is whereby a company subdivides a certain large piece of land into smaller plots and then sells it to unsuspecting investors on grounds that once the land is available for development, its value will significantly rise in a short span of time. However, the truth is that the land in question is owned by another person or doesn’t even exist, or is an area of cultural importance and cannot be developed.
- Boiler room fraud
Boiler room fraud is another common type of investment fraud that seniors are likely to fall victims of. It is where by a group of individuals set up a temporary office especially in a well known are or a city from where they perpetrate their investment fraud. The fact that they have an office will make you trust them and what they are saying while the truth is that the company does not actually exists. They will sometimes direct you to their website, which usually seem professional. They might also have an address to win your trust.