Always be skeptical of investment opportunities you learn about through the Internet. When you see an offering on the Internet you should assume it’s a scam until you’ve done your research and proven otherwise.
How to research Internet Investments in three simple steps:
- Find out if the investment is registered by going to the SEC’s EDGAR database. Some smaller companies don’t have to register their securities offerings with the SEC, so always check with your state securities regulator. You’ll find that number in the government section of your phone book. Or call the North American Securities Administrators Association (NASAA) at (202) 737-0900 or visit NASAA’s website. Be aware that many online investment scams involve unregistered securities. But the fact that a company has registered and files reports with the SEC doesn’t guarantee that the company will be a good investment.
- Find out if the person or firm selling the investment needs to be licensed. Call your state securities regulator and ask whether the person or firm is licensed to do business in your state and whether they have a record of complaints or fraud. You can also get this information by calling FINRA’s public disclosure hotline at (800) 289-9999 or visiting their website.
- If the investment sounds too good to be true, it probably is. High-yield investments tend to involve extremely high risk. Never invest in an opportunity that promises “guaranteed” or “risk-free” returns. Watch out for claims of high yields in a short period of time. Be skeptical of “off-shore” or foreign investments. And beware of exotic or unusual sounding investments, especially those involving so-called “prime bank” securities. Ask for the company’s prospectus and latest financial statements, and read them.
The foregoing information is being provided by The White Law Group. The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida. For more information on the firm and it’s representation of investors, visit http://www.whitesecuritieslaw.com.
For more investor information, https://www.sec.gov.
For a free consultation with a securities attorney, please call the firm at 1-888-637-5510.