Financial scams - don’t get caught!

Since the earliest days of commerce there have always been people prepared to commit fraud against others. With the introduction of the worldwide web, modern fraud has increased the opportunities for the bad guys and heightened the risk for the innocent.

We are all interested in making a better return on our investments but who can we really trust nowadays?

The Australian Competition & Consumer Commission (ACCC), the government body with a charter to protect consumers, has a most helpful website at www.scamwatch.gov.au with tips to assist Australian small businesses and consumers, and lists of scams they have uncovered.

The Australian Securities & Investment Commission (ASIC) warns that financial scams tend to look realistic and are presented professionally. Scamsters often go to a lot of trouble to:

·        print attractive documents and set up a professional looking website;

·        choose names that sound like reputable companies or organisations;

·        convince you with a persuasive story using the names of professional brokers or investment managers.

Some of the clues to look out for include offers with a much higher return than genuine investments. Some offer 20% a year, others may go to 300% or even more. Many scams say that financial success is easy and risk isn’t a problem.

Then again it could be a “secret” offer, “inside information” or “new techniques”. There is always some feature to make you feel like you will have an edge over other people. Every scam gets dressed up as an opportunity, so scamsters will say “don’t miss out”, “act quickly” or, “hurry, before it’s too late”.

Start your research by first checking if the person or company making the offer is domiciled in Australia and operating under a licence issued by ASIC. If you are unsure about the genuineness of a financial offer, you can ask us to check it out for you.

These days, websites are like phone numbers – anyone can have one. Don’t get caught by the unscrupulous. Check with ASIC or us before doing anything – or better still, just ignore the “magic offer”. Always remember the truism, “If it sounds too good to be true – it probably is.”