Investment scams are the last thing people want to worry about following a natural disaster.
Last week, Hurricane Matthew swept along Florida’s east coast on its way to the Carolinas. Major property damage was experienced in northeast Florida, coastal Georgia and North and South Carolina due to flooding.
Natural disasters result in millions of dollars in insurance claims and with that, come the threat of investment scams.
The SEC warns that, as property owners receive lump-sum payments from insurance companies, fraudulent entities seek to take advantage.
Frauds and con-artists bank on uncertainty following a storm or natural disaster. They take advantage of people’s vulnerabilities promising quick fixes or instant relief efforts.
Fraudulent companies will claim “miracle remedies” or create fake relief organizations promising aid in return for investment capital.
Investors and those receiving lump-sum insurance claim payouts in the event of a storm or disaster should be wary of these types of investment scams.
Avoiding Investment Scams:
- Spam email promising high returns for investing in clean-up or relief efforts
- Pump-and-dump schemes: circulation of false or misleading news that promotes a certain product or service, inflating its stock and then dumping it before the trend peaks
- Ponzi schemes: investment scams that use investor money to pay-off prior investors
- Always ask thorough questions before involving yourself in an investment opportunity
- Avoid schemes that promise fast, high returns
- Make sure to know exactly what you are getting in a claim payout. If receiving a lump-sum payment, know beforehand what the money will need to cover for you and your family
You have enough to worry about following a storm or disaster. Don’t let the threat of investment scams be one of them. Protect yourself and your finances.
If someone approaches you with an investment opportunity following Hurricane Matthew or another natural disaster, contact Savage Villoch Law, PLLC and make sure your investment is protected.