There have been a lot of people out there that have gotten into some serious trouble by scamming people out of their money. With this in mind, many people have become more careful when it comes to buying and selling. There are still those out there that are becoming victim to these scams daily. The number of scams is always on the rise, and you will want to avoid them. According to TIME Moneyland, there are five great tips that can help you to avoid some of the well thought out financial scams.
1. Do thorough background checks on your financial planners and brokers.
This is a very simple move, and it can really save you a lot of headache down the road. The best way to start is by searching them out on Google. This can help you to learn some quick information about who you are dealing with. There are many people out there that re-enter the market after getting out of jail for fraud, and there is not really any protection out there to prevent them from scamming others.
2. Use a segregated account for your money.
Many times, scammers will want you to write them a check. Instead of doing this, you should just put your money into a segregated account that has your name linked to it. This will allow you to check your information online and keep a good track of what is going on with your money.
3. Ensure that the account has an auditor that is credible.
When most scammers deal with accounting firms, they choose firms that are made up of their friends. This happens more often than people realize. While they may claim to audit accounts, it may be done by someone that is on their side and not yours. You should make sure that they deal with an accounting firm that is credible.
4. Make sure that you verify the person that will be managing your money.
Before you dive straight into a new investment, you will want to make sure that you verify the person that will be managing your money. Discuss this with your accountant or your lawyer and let them check it out first.
5. Are they registered with FINRA?
People that manage your investments should be registered with FINRA, the Financial Industry Regulatory Authority. You can go to their website to do a quick check and see if they are registered with them. This will also allow you to see if they have been a part of any improper or disreputable activity.
One thing that you must remember is that you need to keep yourself protected when it comes to investing your money.