How to Spot Internet Fraud

The Internet is a great place to get investment information. But you have to be careful that you are not being conned. Internet frauds can be found on websites, emails, newsletters and bulletin boards. Don't fall for these Internet scams by learning how to spot Internet fraud before it's too late.

Instructions

Difficulty: Moderately Easy

1. Be suspicious of emails you receive giving stock advice. Avoid any advice from a newsletter that does not give information about who paid them to give the advice, how much they paid them and what the type of payment was. If the newsletter does not include a disclosure or has them in a very tiny font buried at the bottom, avoid the advice given in the email.
2. Avoid some old investment frauds that have been given new life on the Internet. Be careful of pyramid, risk-free and off-shore investment frauds. All investments have risks and you will still be liable for taxes, even when you use an off-shore account.
3. Stop believing that you are going to get rich quick with an investment. No type of investment is guaranteed. Anything that tries to give you a guarantee is most likely a fraud.
4. Remember that anything posted on an online bulletin board needs to be investigated more. These are not credible sources because the person posting the information can lie about who they are and why they are posting.
5. Ask the company to provide the details in writing to you before you sign up with them. A legitimate company will have no problem providing you with this information.
6. Investigate investment offers further by going online and visiting the Securities and Exchange Commission and the North American Securities Administrators Association.