Nowadays, the world is so complicated that many people get greedy and are lured to wrong investments. They fall prey to investment scams. This won’t only occur in the Philippines but in any country across the world at the same time. So how do you know whether you’re putting your money in a legitimate business rather than a bogus one? Here are the ways:
Most business scams promise high rates of interest on investments within a short period of time. Interest rates beyond 15% are typically given to lure customers to invest their money. Some offer a double your money guarantee in order to attract investors. One good example is the Aman Futures Group in the Visayas and Mindanao. They offered interest rates which ranges from 15%-40% over the following 20-30 days. Naturally, a number of people were fascinated by the high investment yield. And these people are those who did not do a background check for the company.
In order not to be fooled by business scammers, you have to look into the prevailing bank rate on deposits and investments. This will assist as a help guide to people as to what is the on-going rate that is acceptable to the corporate environment. This sounds conservative, but a return of less than 1% each month is already considered high in todays business environment.
No Business Operation
Before putting profit other peoples business, one has to check whether you can find any business operation that’s being done through the company. Scammers have no business at all. What they may have is just a bogus SEC certification, and this can be easily produced by a non-legit businessman, too.
Doing a background check of the founders and the officers of the company will even present you with information on the legitimacy of the business. Lawful business people are usually the top business leaders in their own individual hometown or province. Their presence is always felt in any economic activity in their area.
No License to Sell Securities
Since SEC certificates are public documents, anybody can take a look and do some research. Getting an SEC certification does not necessarily mean that your company can already solicit funds then sell securities to potential investors. A license is needed to manage this step. Therefore, it’s usually best to inquire from the SEC regarding the business where one wished to take their money in.
Early investors are paid to lure other people to invest
Business scam owners usually lure their early investors to get other people whom they’ve known to invest in like they did. The scammers motivate them by providing a very high yield on their investment. This goes on and on until such time that there’s no more money arriving. Check payments to investors keep on bouncing back and therefore the investors discovered that the business enterprise was a hoax after all.
What exactly do we do in order not to fall prey to business scammers? We should first think, investigate, and carefully study. We need to consult financial planners and bankers if we don’t know anything regarding the investment. Checking into the legality of the business and also the investment opportunity with the concerned government agency can even enlighten us on the matter. Remember that when in doubt, never place your money in it. It is best to keep it in other worthwhile economic activities.
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