With all the news circulating about the national average price of gas reaching $3.91 a gallon and states and cities such as Hawaii and Chicago average price hitting all time highs, fraudsters are again attempting to lure investors into green energy investment scams.
In these scams the fraudster attempts to create unwarranted demand for shares of a small, thinly traded company. The scammer then sells off their own shares, leaving investors with a worthless stock.
The con persons are using faxes, emails, text messages and even webinars and infomercials to lure unsuspecting investors into these pump and dump schemes.
Still, there are a number of measures investors can take to help protect themselves from these and other types of scams.
First of all, beware of any high-pressure sales tactics that include pushing you to act immediately or guaranteeing unusually high returns in comparison to other similar investment options. These too good to be true opportunities may be warning signals.
Similarly, use caution if a solicitation claims that the investment is an exclusive opportunity available to only a handful of customers or normally reserved only for the wealthy.
Also, refuse any unsolicited contact from anyone seeking personal financial information or money.
Additionally, investors should use caution if the promoter claims the offered financial instrument is issued, traded, guaranteed, or endorsed by top banks.
Finally, make sure to do your homework. Carefully read any written material provided and check with your state securities regulator to establish if the investment is properly licensed and registered in your state.
Similarly, investors should ask the promoter if they or their firm is registered with FINRA (The Financial Industry Regulatory Authority), The SEC (U.S. Securities and Exchange Commission), or a state securities regulator, and if so, which one(s).
Investors should then take the time to verify the answers before investing any money. To check the background of an investment professional, investors can call the FINRA broker check toll-free at (800) 289-9999.
Additionally, investors can check with their state securities regulator by visiting the NASAA (North American Securities Administrators Association) web site at nasaa.org or by calling (202) 737-0900.
Investors can also better protect themselves by seeking a professional, third-party opinion such as a financial advisor or broker. These individuals should be able to help you with understanding different investment instruments and the risks involved.
Scammers attempting to use tax refunds as a way to steal your identity and or financial assets.
Tips to help find a broker that fits your investing style
Market capitalization and what makes a microcap stock