Wednesday, September 7, 2016

Preventing Securities Fraud - How to Protect Yourself

Investment fraud is not limited to stock frauds and securities fraud. Instead it spans a wide spectrum of scams that include invention scams and rare item investment scams. The scope of investment scams has reached epic proportions with millions of dollars being fraudulently stolen from consumers each year.

If you want to protect yourself from investment frauds and scams that you need to learn how to identify the warning signs of a potential scam. The first warning sign is that the offer sounds too good to be true. The second warning sign is that the seller of the offer is using high pressure sales tactics such as forcing you to make a decision to invest right now. Another warning sign is that you are contacted via phone without requesting information about the investment opportunity. The scam artist may also ask for your social security number or credit card information over the phone. These are all signs that you are being targeted by a scam artist. There are several federal documents and pamphlets that you should read through that tell you what to look for and what scams are currently circulating. You can request fraud education materials from the Federal Trade Commission, the SEC, and from your state's securities regulator.

There are many different crimes in the world today. Some of the overlooked crimes fall into the white collar crime category. This category is made up of crimes that do not necessarily "hurt" someone. They often happen in professional settings and include things such as embezzlement, pyramid schemes, and fraud. Many times when people see some sort of corporate scandal on the news, it is about a white collar crime. It has been found that the public as a whole is more willing to forgive people who commit these crimes. It is important to remember that they can result in just as much jail time as any other type of illegal activity.

White collar crimes are frequently committed by people in government or business positions. Many of them are felonies and typically involve some sort of fraudulent activity. There is a long list of crimes including:

  • Forgery
  • Money laundering
  • Insider trading
  • Bribery
  • Copyright infringement
  • Identity theft
  • Commodities and securities fraud
  • Embezzlement
  • Any and every type of fraud such as bankruptcy fraud and insurance fraud

The biggest difference between blue collar crimes and white collar crimes is that violence is normally not a factor in white collar offenses. The perpetrators are normally financially privileged, especially in comparison to blue collar offenders. Money is often the main motivation of these crimes and while it causes no physical harm to others, businesses and individuals can lose hundreds of thousands of dollars. Any office where financial transactions take place and sensitive information is accessed on a daily basis is at risk for crime. Whether it is a corporate, business, or government office, no environment is immune.

The news is often full of corruption and large corporation scandals. These are perfect examples of the magnitude that white collar crimes can reach. One positive side of handling white collar crimes is that the offense can be committed by an entire agency and not just a single person. Civil law suits against companies can occur because of this type of crime. Common crimes that can be committed by the institute and not the individual include price fixing, false advertising, and company overcharges.

While it would stand to reason that technology improvements would provide better security for businesses, technology is actually making it easier for money to be stolen especially by a savvy person. The crimes are facilitated with computers, paperwork, and any other type of electronic device. These crimes result in some sort of benefit from the company or employee. The goal is normally to make money whether it is through stealing or insider trading.

If you find that you have been victimized by a securities fraud or some other type of investment fraud then you need to take immediate action to correct the situation. First you need to report your victimization to the authorities. Try to provide them with as much information as you can about who contacted you, how they contacted you, how you funded your investment and any other information that you have. You will also want to contact an SEC lawyer, a securities fraud attorney or an investment fraud lawyer. They will be able to help you develop a case against the company or person who victimized you, they will be able to answer your questions, and they will help you to win your lawsuit against the perpetrators of the fraud in question.