Red Flags of Investment Seminar Scams

June 14, 2010

We’ve all heard the ads for “free lunch” seminars indicating all that is required to receive a free lunch is to listen to a sales pitch. Your BBB warns consumers to be extremely careful not to get sucked in by a flashy presentation or the promise of big returns.

Your BBB recommends looking for the following red flags during an investment pitch:

· The presenters are using high pressure sales tactics. Some of these tactics may include telling the consumer they must sign up immediately or there are only a few spots let. You should never feel pressured to sign up and you should always take time to think things over.

· The company is requesting a large up-front investment. Any company that is asking for large sums of money upfront may be trying to take the money and skip town.

· The company is promising high returns for low risks. Any investment is a risk and normally the more you invest, the riskier things become.

· The company is using off-shore investments. Companies sometimes use off-shore investments to sound more sophisticated, or they falsely claim you can avoid taxes by investing overseas.

· And last but not least…if it sounds too good to be true, it normally is.

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