Florida Investment & Securities Lawyer
Call to Schedule a Consultation
561-417-8777

Updated Investor Alert for Seniors: Five Red Flags of Investment Fraud

Per Securities and Exchange Commission:

Older Americans are often targets of investment fraud.  The SEC’s Office of Investor Education and Advocacy is issuing this Updated Investor Alert to help seniors identify signs that what is offered as an investment may actually be a fraud.  Below are five “red flags” seniors should look out for when making an investment decision.

Unregistered and Unlicensed Sellers.  Always check whether the person offering to sell you an investment is registered and licensed, even if you know him or her personally.  Unregistered and unlicensed persons commit many of the frauds that target older investors.  Researching the background of the individuals and firms selling you investments, including their registration/license status and disciplinary history, is easy and free:

You can also call the SEC’s Office of Investor Education and Advocacy directly to help research the person and firm selling you the investment:  (800) 732-0330 (open 9:00 a.m. to 5:30 p.m. EST Monday through Friday).

Promises of High Returns with Little or No Risk.  The promise of a high rate of return, with little or no risk, is a classic warning sign of investment fraud.  Every investment carries some degree of risk, and the potential for greater returns usually comes with greater risk.  Avoid putting money into “can’t miss” investment opportunities or those promising “guaranteed returns.”  Remember – if it sounds too good to be true, it probably is.

Pressure to Buy Quickly.  No reputable investment professional should push you to make an immediate decision about an investment, or tell you that you have to “act now.”  If someone pressures you to decide on an investment without giving you time to do your research, walk away.

Free Meals.  Be wary of “free lunch” seminars.  The ultimate goal of free meal investment seminars is typically to lure new clients and to sell investment products, not to educate the public.  If you decide to attend one, commit to yourself before the seminar that you won’t purchase anything or open an account while at the seminar.  Even if the free meal does not come with a high-pressured sales pitch, you should expect the “hard sell” in subsequent contacts from the person selling the investment.

Red Flags in the Financial Professional’s Background.  Even if an investment professional is in good standing with his or her regulators, you should be aware of potential red flags in the professional’s background.  SEC, FINRA, and state securities regulator records can be used to identify red flags for potential problems, including: (1) employment at firms that have been expelled from the securities industry; (2) personal bankruptcy; (3) termination; (4) being subject to internal review by an employer; (5) a high number of customer complaints; (6) failed industry qualification examinations; (7) federal tax liens; and (8) repeatedly moving firms.

Additional Resources

  • If you are thinking about investing and have any questions, do not hesitate to call the SEC’s Office of Investor Education and Advocacy at (800) 732-0330 or ask a question using this online form.

Investors can also order hard copies of our free publications by calling (800) 732-0330, or access them on the Internet through the SEC’s Investor.gov website.  For additional educational information for investors, see Investor.gov.

Gregory Tendrich, PA
Gregory Tendrich, P.A. serves clients throughout Florida, including the cities of West Palm Beach, Palm Beach, Delray Beach, Boynton Beach, Boca Raton, Port St. Lucie, Lake Worth, Wellington, Riviera Beach, Palm Beach Gardens, Fort Pierce, Vero Beach, Hobe Sound, Jupiter Island, North Palm Beach, Lake Park, Lantana, Stuart, Palm City, Jensen Beach, Tequesta and Juno Beach and represents clients in Palm Beach County, Martin County, St. Lucie County, Indian River County and throughout Florida.

Our Location

3010 N. Military Trail, Suite 210
Boca Raton, FL 33431

Telephone: 561-417-8777
Fax: 561-417-8700

The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.

No content on this site may be reused in any fashion without written permission from www.YourStockLawyer.com

MileMark Media - Practice Growth Solutions

© 2015 - 2018 Gregory Tendrich, P.A. All rights reserved.
This law firm website is managed by MileMark Media.

Contact Form Tab