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You work hard for your money. So when someone offers you an “exclusive opportunity” to make it grow quickly, it’s tempting to say yes. But not every offer is what it seems. In fact, investment scams are some of the most financially devastating forms of fraud in the U.S., with Americans losing over $5.7 billion in 2024 alone, according to recently published FTC data.
Whether it’s a fake cryptocurrency pitch, a too-good-to-be-true real estate flip, or a scammer posing as a financial advisor, knowing how to recognize investment fraud is your best defense.
Investment scams are deceptive schemes in which fraudsters promise high returns with little or no risk. They often involve fake businesses, unregistered securities, or impersonations of legitimate professionals. The goal is simple: to convince you to hand over your money, perhaps steal your identity, and then disappear.
Scammers may contact victims via email, social media, phone calls, or even in person. Some create elaborate websites or use professional-looking documents to make their pitches seem credible.
Be wary of anyone who promises “guaranteed” or unusually high returns. If you’re pressured to invest quickly or told not to miss out, that’s a red flag. Watch for unregistered investment products or advisors, and be cautious if explanations of how the investment works are vague or confusing. Another warning sign is having difficulty withdrawing your money after investing.
Start by doing your homework. Research the investment and the person offering it. Use FINRA’s BrokerCheck or the SEC’s Investment Adviser Public Disclosure database. Make sure any financial professional you’re dealing with is properly licensed.
Be cautious about sharing personal information too soon, especially if someone you’ve just met starts talking about money, as this could be step one of being targeted for identity theft. Ask questions and expect clear, thorough answers. Don’t hesitate to report the suspicious offer to the FTC, SEC, or your state securities regulator if something feels off.
If you’ve fallen victim to an investment scam, you’re not alone and may still have options. Contact a consumer protection attorney who can help you assess your legal remedies. Also, gather all records, communications, and transaction details to support your case.
Remember: if it sounds too good to be true, it probably is. Stay informed, trust your instincts, and take your time before parting with your hard-earned money.
If you suspect an investment scam has targeted you, contact our team of experienced attorneys to learn about your options.
