Maybe your employer has cut back on hours or maybe you’ve lost your job altogether. You’re desperate. Bills need paid. Late one night an email hits your in-box promising wealth and riches. But you’re smarter than that. Delete. Stupid scammers. Then another, less flashy one hits.
This one doesn’t promise riches. It explains how you can earn enough to pay your bills and avoid foreclosure. The amount seems reasonable—$2,000 per month in a few months. It requires you to work (looks good so far). You spend $99 maxing out your last credit card. The “Cash Strapped” course never arrives. Emails to support bounce back. You’ve been scammed by what seemed like a reasonable offer to make just a little more money.
Of course, scams aren’t just for those desperately seeking work. People with early retirement dreams are scrambling to re-build devastated 401Ks and are quickly becoming prime targets for today’s sophisticated scammers.
Apparently, investment banks aren’t the only ones getting rich during the recession according to a recent USA Today article.
“Investment scams always sprout during a recession, and con artists are reaping a big harvest in this economic downturn.”
The North American Securities Administrators Association released its annual Top 10 Investor Traps. A few among them:
Green schemes. Alternative energy frauds play on the allure of energy-efficient technologies. Some scammers pushed oil-spill cleanup technology in the wake of the Gulf oil spill.
I definitely think this scam will continue to grow as energy costs skyrocket.
Unsolicited online pitches. Scam artists have found a new home in social media. You’re not going to get a hot penny-stock tip from an anonymous e-mail. You won’t get one on Facebook, Twitter, or Craigslist, either.
Based on my own experiences looking for rental houses on Craigslist (I can’t vouch for other categories), 9 out of 10 listings were outright scams. I wouldn’t touch any kind of investment opportunity on Craigslist. Ever.
A growing scam that’s not on the list: viatical schemes, where you invest in securities backed by the life insurance of a dying person. The dying person gets an immediate cash payout, while the backer of the plan pays the insurance premiums and collects the death benefit.
Wow. It’s a dangerous world out there. Tread carefully.
Get the full list of top investment scams.