Protect Yourself from Financial Fraud
Source: AARP.org
Even in the most stable and flourishing economy, investing can be confusing. How much money should you invest? Where should you invest it? But there’s another question you can’t afford to ignore: how can you avoid becoming the victim of fraud? In today’s uncertain economic conditions, investing can be downright intimidating, and wise investment choices are more important than ever. Unfortunately, scammers depend on confusion and uncertainty to separate you and your money.
AARP is working with legislators, other state leaders and nonprofit organizations to help you spot financial fraud, toughen laws and punishments for unscrupulous fraudsters, and help regulators weed out con artists and criminals.
CHANGING THE LAWS
The first step in helping to protect investors from frauds is to stop the scam artists in their tracks before they can attack. AARP worked with Florida Chief Financial Officer Alex Sink through the Save Our Seniors task force, put in place to help protect seniors against financial fraud. This year, AARP is supporting two proposals to toughen punishments for convicted fraudsters, and to help prevent annuity and securities fraud in the first place.
Senator Michael Bennett, R-Bradenton, is sponsoring Senate Bill 724, “Florida Senior Annuity Bill of Rights,” which would require reasonable terms for those 65 years of age and older who invest in annuities. Seniors across Florida – and across the country – have been targets of annuity investment fraud by unscrupulous salespeople.
Using fast talk and carefully designed misleading tactics, these agents have convinced seniors to purchase annuities that are completely inappropriate for their needs. Sometimes, investors in their 70s, 80s or 90s are being persuaded to sell solid investments and buy annuities that don’t allow them to collect money until after a maturity rate of 20 years.
These annuities also can carry outrageous “surrender charges” for accessing your money before the maturity date, sometimes reaching 40 percent. The bill proposed by the Senate would put provisions in place that limit the maximum length of a surrender charge and the maximum amount that you can be charged.
AARP also supports House Bill 483, a bill proposed by the Florida Office of Financial Regulation (OFR) and Rep. Tom Grady, R-Naples, to help put an end to securities fraud. In addition to toughening registration requirements for those who deal in securities, the bill will give the State broader rights to pursue fraud charges and the ability to impose stricter penalties upon predators.
STEPS TO PROTECT YOURSELF
Whether investing in securities through the stock market or in annuities, smart investors are informed investors. AARP is working with organizations such as the Financial Industry Regulation Authority (FINRA) and OFR to promote financial safety education, presenting forums in both Daytona Beach and The Villages. On April 27, AARP will again partner with U.S. Rep. Ron Klein, D-Boca Raton, and FINRA to present an investor forum by www.SaveAndInvest.org, the FINRA Investor Education Foundation’s effort to reduce fraud among older investors. The forum will be held in Boca Ballroom at Marriott Boca Raton at
In addition, you can help AARP protect others by acting as the eyes and ears of a national anti-fraud effort. Four out of five investors over the age of 60 have received at least one invitation to a “free lunch seminar” over the past three years. While many of these seminars are legitimate, those who prey on seniors and their money also use these forums to get a foot in the door, and then use high-pressure fraudulent tactics to trick you. To help monitor these seminars, learn how to become a Free Lunch Seminar Monitor.
Most important, take the time to educate yourself on your investment options, and always make sure that you thoroughly understand any investment plan you may choose. Information can be your best protection.
Related Articles:
Become a Free Lunch Seminar Monitor
Other Resources:
http://www.finra.org
http://www.ofr.org
http://www.flofr.com/
http://www.saveandinvest.org
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