Educational Consumer Tips
Author: Better Business Bureau
If you are going to invest in risk-oriented investments such as
the stock, bond or commodities market, be aware of the
associated risk that comes with these investments. Make sure
your broker/ agent explains the risk level involved with these
investments. Ask questions of yourself and those who are
soliciting your investments.
Whether you find your investment opportunity or advisor through
a telephone solicitation, financial seminar, advertisement,
referral, or the phone book, it is always wise to ask the
(1) Is the company or adviser registered to sell securities and
have I verified that they are registered or exempt with the
appropriate government agency?
(2)Will the company allow me to wait a few days before making a
(3) Is the company soliciting me willing to provide me with
written proof of how much of my investment is going to the
actual purchase or development of the opportunity and how much
is going to commissions, promoters' profits and marketing costs?
(4)Do I have an established, professional, independent,
knowledgeable, trustworthy person who can advise me about this
type of investment?
(5) Have I fully checked out and verified all of the details and
claims that the company has made?
Regulatory agencies regarding financial planners and investment
advisors are as follows: CA Dept. of Insurance, Federal Trade
Commission (FTC), State Department of Corporations, Securities
and Exchange Commission (SEC), and the Commodity Futures Trading
For a Department of Corporations investment company checklist, see: http://www.corp.ca.gov/Education_Outreach/pdf/saif/SAIFCheckBeforeYouInvest.pdf.