Don't think you are too savvy for it to happen to you, don't be afraid to ask questions and don't be embarassed to ask for help if you are taken advantage of financially, Missouri Secretary of State Jason Kander bluntly told seniors Thursday in Cape Girardeau.
Kander visited the Cape Girardeau Senior Center as part of a weeklong tour, where he is traveling the state to talk about investment scams that target seniors and how people can check out potential opportunities before they lay down money.
The secretary of state's office acts as a regulator of securities in Missouri. Among the related duties Kander's office handles are investor education, enforcement and registration.
During the Cape Girardeau stop, Kander outlined five types of fraudulent investment scenarios his office sees that tend to draw in seniors.
First and most commonly, Kander said, there is a scam involving the offer of management for online brokerage accounts. Kander said the Cape Girardeau area has seen a case of that type of fraud recently.
The scam includes the offer to set up of an online trading account using a well-known company and management of the account. Kander said seniors should be especially wary of a situation where a broker or trader is sharing a username and password with an investor.
"The company doesn't know that it's not you," Kander said. "It's not a whole lot different than giving someone your bank account number."
Investors should be suspicious when they don't receive statements in that situation, too, he said.
Another concern for investors, according to Kander, should be the registration status of a trader or broker. Both the people who deal in investments and the investment product itself should be registered with the secretary of state's office, he said, and someone thinking about investing money also should check whether professional designations listed on business cards or other identification of a trader or broker are genuine.
"If someone is not registered, you may still feel like you can do business with them," Kander said, "but you have to wonder why they want to do things outside the rules."
Kander also warned against becoming involved in financial dealings that have the characteristics of a Ponzi scheme -- a setup where high returns on investments can be earned -- but only when new investors' money is used to pay returns to the existing ones.
Fake real estate investments are another area where seniors can become targets. Kander said seniors should watch out for offers of investments on property, especially if developments are promised in a location the investor will likely never visit, or involve renovations of properties.
Lastly, Kander said, seniors should watch out for investment fads that are often pitched as new opportunities to make money as a result of changing laws or government regulations.
Offers of investments and credentials can be checked by calling the state's Investor Protection Hotline at 1-800-721-7996 or by visiting www.MissouriSafeSavings.com.
eragan@semissourian.com
388-3627
Pertinent address:
911 N. Clark St., Cape Girardeau, MO
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