Everyone knows that playing the stock market can be a gamble: you never really know if and when your investment might take a dive, or, much more happily, soar and quickly line your pockets with gold.
Though there is uncertainty when it comes to investing in stocks, securities fraud is one misfortune you can protect yourself—and your money—against by knowing the signs.
- It Sounds Too Good to Be True
The old adage holds true when it comes to stock investment. Securities fraud occurs when false information is used to make a buy or sell look more attractive, so numbers that seem unbelievable might be just that.
- It’s Hard to Find Information on the Company
If there is little to no information on the company you’re considering buying stock in, that’s a red flag that fraud may be afoot. It doesn’t necessarily mean the investment is a scam, but a lack of information—such as registration documents or financial reports—should make you, as an investor, extra vigilant.
- You’re Making Decisions Based on Guesses
Fraudsters often target those who are by and large unfamiliar with complicated investments and who won’t be able to identify securities fraud until it is too late. If you suspect something about your investment seems fishy, or you feel in over your head, contact a litigation lawyer to help assess your situation.
- Your Financial Adviser Is Overly Aggressive
If you’re working with a financial adviser to make investment decisions, they should be advising you, not pressuring you. If you’re being promised huge returns on highly speculative, “once in a lifetime” investments, it could be an effort to capitalize on adviser fees or engage in securities fraud on behalf of the company being pitched.
- The Company Is on the “Investment Caution List”
The British Columbia Securities Commission provides a list of suspect companies and brokerage firms to help protect BC investors. If you discover a business you’ve purchased stock in is on the list and suspect securities fraud, a litigation lawyer can help you decide what to do next.