Alluring prospects together with big risks of losing investments anticipate beginner investors who want to increase their capital. Today’s world of communications provides great opportunities to both: earn and lose your money in investments. Different kinds of investment projects often create an obstacle for novices in choice-making. At the same time, this market has existed for many years and has already developed certain rules of the game to protect investors as much as possible. Based on this practice, Jewish Review suggests potential investors familiarize with critical issues that are worth paying attention to and with common tricks of dishonest investment projects of this segment.
- Fraudsters often use start-ups. Popular ones are in the area of alternative energy (wind and solar energy), raw materials sector (gold mines, oil, etc.) or medical technologies. Potential investors are often fascinated by these projects having heard about significant profits in these industries and many of them are inspired to be part of growing and environmentally friendly projects.
- You should be attentive to the so-called “cold calls” that are used to advertise the project, while the investor is informed about the planned IPO, which supposedly should increase share values many times. To do this, you might be shown splendidly designed Internet sites or glossy prospectuses of companies. They are wrongly assessed by investors as a sign of respectability of the company.
- Before making a decision, experts recommend checking if the name of the company and business place change oftentimes or if capital increases occur with very small denominations shares, this might be a warning sign. This may be done through specialized governmental websites and registries.
- Fraudsters increasingly using copies of companies’ websites whose activities are licensed. Therefore, financial market watchers recommend examining whether this is the original site of the company or a copy. It may be an illegal financial player who uses the company’s name for fraudulent purposes.
- Often to scam investors, companies issue front persons — in such cases, investigations are not always successful. Therefore, experts recommend to take care of the safety of your investments in advance and not to be seduced by high-profit interests right away.
- Oftentimes potential investors are impressed by stunning setting, luxury goods, celebrities, famous guests and speakers who are invited by frauds to promote their projects. Therefore, experts recommend paying attention to the financial performance of the company, activity license and the history of the company instead of the setting.
This article is based on materials provided by financial regulators of the Philippines, Singapore, Malaysia and Switzerland. Also, our sources have provided information that some financial regulators in different regions are receiving frequent requests about Financial.org project which possibly executes unlicensed investment activities in some Asian countries and the East.
As reported by the Business Times, Malaysia’s Securities Commission also placed Financial.org on a list of “unauthorized websites/investment products/companies/individuals” last year. At the moment, the data we have about the aforementioned project is controversial, however in the future, we are planning to make a publication on this topic.