Investment Scam
Investment scams involve fraudulent schemes where scammers promise high returns on investments, attracting individuals to invest money with the intention of stealing funds.
How is an Investment Scam Executed
1. Unrealistic Returns
Scammers promise unrealistically high returns on investments to attract individuals looking for lucrative opportunities.
Once funds are invested, the scammer disappears, and the promised returns never materialize.
2. Pressure Tactics
Fraudsters use aggressive tactics, such as creating a sense of urgency, to pressure individuals into making quick investment decisions.
Victims may feel compelled to invest without conducting proper due diligence.
3. Ponzi Schemes
Some investment scams operate as Ponzi schemes, where returns to earlier investors are paid using the capital from newer investors.
The scheme collapses when there are not enough new investors to pay returns.
What to Look Out For
Research and verify the legitimacy of investment opportunities, including checking the credentials of the company and understanding the risks involved.
How to Protect Yourself
- |01
Verify Investment Opportunities
Conduct thorough research and verification before investing. Check the credentials of the company and understand the risks involved.
- |02
Beware of Pressure Tactics
Be cautious of investment opportunities that use high-pressure tactics and create a sense of urgency. Take the time to make informed decisions.
- |03
Avoid Unrealistic Returns
Exercise caution if the promised returns on an investment seem too good to be true. Unrealistic returns are often a red flag for potential scams.