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AS PEOPLE GROW OLDER, they can be common targets for fraud and f i n a n c i a l c r i m e s . Scam artists and unscrupulous sales people target seniors, often making contact with them via phone calls, emails, persona l sa les pitches, and pop-up ads on the Internet. Here are a few guidelines to follow that may help protect you or a loved one from investment fraud. Proceed with caution. Don't jump into an investment. Slick websites, smooth- talking solicitors, high-pressure sales pitches, and extravagant promises can be misleading. Before investing in any investment product or service, it's important to consider your overall financial situation. Is the product or service right for you? Be aware of your liquidity needs, fees, and costs associated with an invest- ment. Consider your income needs and the overall risk you can afford to bear with any investment. Beware of misleading information. There is some wisdom to the old adage, "If it seems too good to be true, it prob- ably is." Offers of an investment with an above-average rate of return or income rate and little-to-no risk are almost always deceptive. The same is true of guarantees to make money or to achieve a guaranteed rate of return. Be wary if the solicitor asks you not to tell anyone else about the investment, tells you it is a one-of-a-kind deal, or that other people (maybe even dropping the names of prominent people in the area) have already bought in to the arrangement. Services described as a "limited-time offer" or any person who pressures you to make an immediate investment decision should also raise a red flag. Don't be afraid to ask questions or to seek a second opinion. Few t h ings in life a re f ree. For example, seminar invitations that come with an offer of a free meal may seem appealing. However, some of these seminars turn into high-pressure events where you may be given bad advice or be pressured to open an account that is not suitable for your financial situation. Skepticism is healthy. Contact your law enforcement agency immediately if you suspect an individual or organiza- tion is employing fraudulent actions. Investment fraud can ta ke many forms. There are Ponzi schemes, for example, where fraudsters advertise high rates of return on client invest- ments. High payouts may continue until new investors a re no longer available. Then the scheme and all the money disappear. Other common schemes to watch out for include pyramid schemes; scams involving coins and precious metals; ow nership interests in oil a nd gas interests; vertical scams (known as "cashing out" of a life insurance policy, or a "living benefit"); affinity fraud through community groups, clubs, and even places of worship. What to do. End the conversation. Practice saying "no" or "I always speak with someone else before making deci- sions." Have an exit strategy. Turn the tables. Ask questions. A legitimate investment professional — as well as his or her firm — must be properly licensed with a regulator depending on the type of business the individual (or firm) conducts. Talk to someone. Stepping away from the situation and asking for another opinion can help you see the true value of an offer. Ask a financial advisor about the ways you can protect yourself or a loved one by monitoring your personal financial information and being selec- tive in providing access to personal data. The SEC ha s prepa red "Seniors: Protect Yourself Against Investment Fraud". The Better Business Bureau and the FINR A Foundation created a website http://w w w.bbb.org/smart- investing/ where you'll find a pamphlet for more information. Paul Guerra is the managing principal of Brookshire Wealth Management in Canton OH. For more information visit www.brookshirewealth.com or e-mail Mr. Guerra at pguerra@brookshirefinancial.com. Investment products and services are of fered through Wells Fargo Advisors Financial Net work , L LC ( W FA FN), Me m b e r SI P C . B r o o k s h i r e We a l t h M a n a g e m e n t i s a s e p a r a t e e n t i t y f rom WFAFN. Wells Fargo Advisors does not provide legal or ta x advice. Be sure to consult with your tax and legal advisors before taking any action that could have ta x consequences. Please consult your legal advisors regarding your fiduciar y duties. Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUAR ANTEED/MAY LOSE VALUE. Wells Fargo Advisors Financial Network, LLC, Member SIPC, is a registered broker- dealer and a separate non-bank affiliate of Wells Fargo & Company. ■ Preventing Investment Fraud By Paul D. Guerra 3 4 | Cleveland/Akron/Canton MD NEWS ■ M D N E W S . CO M ■ S E P T E M B E R /O C T O B E R 2 0 1 4