Solicitations Are Tricky Business

Too good to be true

My favorite mailings, though, have come in the past two years in identical multicolored formats, touting penny stocks that seem not to be actually listed. “This online technology stock could soar over 750%,” claimed one, which featured a box: “Explosive Growth Forecast, 1 month: 300%-400%, 3 months: 900%-1200%, 1 year: 2000%-2200%.” One of the reasons the company’s potential was so great, according to the flyer, is that “it operates in a $1 trillion industry.”

“Turn $5,000 into $25,000 in weeks,” it said on the reverse side, along with a photo of a guy in a suit jumping for joy. “The one stock perfectly positioned at the center of this unprecedented growth opportunity—with the potential to explode at any moment and appreciate 300-400% in only 1 month if not days!”

At the bottom, in teeny, tiny print, clearly not designed for wearers of reading glasses, the disclaimer: “This informational mailer does not purport to provide an analysis of any company’s financial position, operations or prospects and this is not to be construed as a recommendation or an offer or solicitation to buy or sell any security.” So I guess they were just kidding when they said: “Load your portfolio with [this stock] before the rest of the world finds out.”

Oh, and lest I forget, there was the offer I got that represented an “unprecedented growth opportunity” because it served such a huge growth industry. That industry was the bleeding and nearly left-for-dead automotive sector. Too bad I passed on the invitation to invest in “One of America’s Most Secretly Kept Investment Opportunities.”

Martha M. Hamilton, formerly with The Washington Post, writes a regular column, Your Financial Future, for AARP Bulletin Today.