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Five Tips for Protection Against Investment Fraud

Securities Investor Protection Corporation pic

Securities Investor Protection Corporation
Image: sipc.org

New York-based Aegis Capital Corp. provides a wide assortment of financial and investment services for investment banking, venture capital and private placement, debt marketing, and advisory. In addition, Aegis Capital Corp. also maintains membership with the Securities Investor Protection Corporation (SIPC), which helps investors understand and protect themselves against fraud. The following list includes a few tips for avoiding fraud.

1. Check statements for accuracy – Review all documents, statements, and confirmation reports with a critical eye and check to ensure it properly reflects your account activity. Remember to review documents as soon as they arrive and immediately report any errors you find.

2. Keep copies of writings and documents – Make copies of any correspondence you send to your brokerage firm and keep them in a secure place.

3. Beware of investment scams – Learn to recognize five classic types of investment scams – Ponzi schemes, Pyramid schemes, pump-and-dump, offshore scams and advance fee fraud –and their respective warning signs and red flags. Additionally, familiarize yourself with the kind of tactics used by investment scams.

4. Beware online opportunities – The digital age has created a new platform for investment fraud: the internet. Take caution when investing in an online opportunity that requires your personal information. Common places for internet fraud include online bulletin boards, investment newsletters, and spam mail.

5. Become familiar with your State Securities Regulator – Consider getting to know your State Securities Regulator, who can verify the licensure of broker-dealers and provide crucial information about their history. They can also offer education resources and access to protection materials.