David Lerner Associates: Three Steps to Help Prevent Financial Fraud over the Holiday Season

David Lerner Associates: Three Steps to Help Prevent Financial Fraud over the Holiday Season

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International Fraud Awareness Week aims to minimize the impact of fraud by promoting anti-fraud awareness and education. Financial fraud has become a part of almost everyone’s life: according to findings published in a research report issued by the FINRA Investor Education Foundation, Financial Fraud and Fraud Susceptibility in the United States, 84 percent of respondents have been solicited to participate in potentially fraudulent schemes.

 Older Americans are especially vulnerable to financial fraud, says this report. Those over 65 are more likely to be targeted by fraudsters and more likely to lose money once they’re targeted.

Unfortunately, everyone is at risk as scam artists today are very sophisticated. Such fraudsters are “masters of persuasion, tailoring their pitches to match the psychological profiles of their targets,” notes the FINRA Foundation. They look for your Achilles’ heel by asking seemingly benign questions — about your health, family, political views, hobbies or prior employers. Once they know which buttons to push, they’ll bombard you with a flurry of influence tactics, which can leave even the savviest person in a haze

These three strategies to help investors distinguish between legitimate and fraudulent investment opportunities:

1. Be suspicious, and end the conversation. If you are at all suspicious about a call about an investment opportunity, simply say, “I’m sorry, I am not interested. Thank you.” And hang up. By knowing (and practicing) your exit strategy in advance, it will be easier to end these conversations, even if the pressure starts rising.

2. Turn the tables, and ask some the caller some questions. A legitimate investment professional must be properly licensed and registered with FINRA. And securities must be registered with the SEC before shares can be sold to the public. So ask callers if they are FINRA licensed, and verify their answers by visiting SaveAndInvest.org or by calling (888) 295-7422.

You can also call your state securities regulator to find out what they know about the caller, and consult the SEC’s EDGAR database of company filings at www.sec.gov/edgar.shtml.

3. Talk to an objective investment professional before making any investment decisions. If the caller tells you not to tell anyone else about this “special deal,” this should raise major concerns. Legitimate investment professionals usually will not make a request like this. You should always talk to an objective, independent investment advisor who is looking out for your best interest before making any investment decisions.

Another way to protect yourself is to remove your name from telemarketing and junk mail lists. Here are some resources to help you do this:

• Telemarketing Calls: www.donotcall.gov or (888) 382-1222
• Direct Mail and Email Offers: www.dmachoice.org 
• Credit Card Offers: www.optoutprescreen.com or (888) 567-8688
• Online Cookie Collecting: www.networkadvertising.org

Most legitimate securities firms will honor your request. So, if you still receive a solicitation after removing your name from these lists, there’s a good chance it is from an investment or financial fraudster.



Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable-- we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC.



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Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Teaneck and Princeton, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 516-921-4200 Visit our website: www.davidlerner.com

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Jake Mendlinger
Account Manager
516.829.8374 X 232

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