HOW TO SPOT A CON ARTIST - NASAA



HOW TO SPOT A CON ARTIST

HOW TO PROTECT YOURSELF AGAIN FINANCIAL FRAUD

PRESENTATION OUTLINE

* Prior to starting presentation, ask everyone to sign in. (See Attachment A) *

INTRODUCTION

• Name / Title / Organization / Background

• Purpose / Objective Of Presentation

Start by explaining that there are two major lessons the audience should learn from this presentation.

LESSON ONE

Tell the audience that you usually bring with you a five, ten or twenty dollar bill to show them an example. You didn’t bring one, so can someone “give” you a five, ten or twenty dollar bill.

Hopefully, a few of them will start scrambling to help you. Once someone gives you a bill... tell them “Lesson Number One”. [ Go to next slide ]

Read the slide and explain why they shouldn’t be giving money to someone if they don’t know exactly what the person is going to do with it. If applicable, also point out how eager people were to just give there money away.

[ Before going to the next slide ]

LESSON TWO

Retrieve the sign in sheet. Ask the audience how many people signed in. Then, ask them if they know what they signed.

Read the instructions on the first page to them out loud. Then, read to them the second page and explain to them why they shouldn’t be signing someone thing without reading it.

[ Go to next slide ]

Explain again why Lesson One and Lesson Two is so important.

Explain that past presentations were on specific frauds; pyramid schemes, ponzi schemes, etc. However, con artists don’t come to you saying “I have a scam/schemes for you”. Therefore, this presentation is geared to help people recognize what a con artist would say, do, try and get you to do, etc. and how you can protect yourself.

[ Go to next slide ]

2004 TOP TEN FINANCIAL SCAMS

• “2004” Top Ten - Senior Fraud #2

• [ Go to next slide ] Senior Fraud Will Be Enlarged And Highlighted

• Good News - “2005” Top Ten - Senior Fraud #6

• Bad News - Senior Fraud Still In Top Ten

CON ARTISTS USE “STATEMENTS”

• I Just Got A Hot Tip / This Is A Sure Thing

Con artists try to entice you with one liners. Often times, if you ask them to disclose or validate their statement, they can’t or won’t want to.

• No Other Investment Will Give You Similar Returns

No one investment is so unique that it is the only one of its kind.

• Guaranteed, Or Your Money Back

Nothing is guaranteed! Note, the higher the risks the more chance of gains/losses, the lower the risk the less chances of gains/losses.

• Everyone Who Invested Are Rich

Enticement. Con artists will try to use this statement to validate their scam or scheme.

• You Have to Invest Today / It Can’t Wait Until Tomorrow

High pressure sales. Con artists don’t like to give you time to validate or research their investment or to talk to other people.

CON ARTISTS LIKE TO

• Use High Pressure Sales Tactics / Try to Make Things Happen... Today

Again, con artists don’t like to give you time to validate their products, talk to other people or research who they are.

• Likes To Deal In Cash

It makes it harder for authorities to trace them.

• Try And Obtain Financial Account Info

Con Artists will make it seem like they are doing you a favor by handling your transactions or even make it seem like it is the only way they can do a transaction. Never give out your financial information, pin numbers or social security numbers.

CON ARTISTS PUSH POORLY UNDERSTOOD FINANCIAL PRODUCTS

• They Don’t Want You To Know What You Are Buying

That’s because if you knew what you were buying, you probably wouldn’t buy it.

• Too Complicated To Explain

Con Artists like to tell you this. Nothing should be too complicated to explain. If you don’t know what you are investing in, you shouldn’t be investing in it.

• Trust Me

Common phrase used by con artists. They will tell you that you don’t have to read it... just trust me.

• Simply Stated / Explained In General

Don’t be afraid to ask questions. Even if something is explained to you in general, take the time to read it for yourself.

CON ARTISTS BRING OUT THE WORST IN YOU

• Greed / Who Wants To Be A Millionaire?

Con Artists know how you think and how you would respond. They know that it is very easy to get hooked on greed.

• Fear / What If You Get Sick?

Con Artists will tell you stories of people who got sick and they or their spouses suffered financially.

• Insecure / You Won’t Have Enough Money!

They will play with your emotions.

CON ARTISTS DON’T LIKE TO BE FOUND

• You Can’t Call Them Or Visit Their Office

It’s because they don’t have one. Con Artists don’t like to be traced. A simple way to test them is to ask to meet at their office or you’ll call them to make an appointment. It is very unusal for a reputable business/person not to have a place of business or business telephone.

CON ARTISTS DRESS FOR SUCCESS

• Use Their Appearance

Con Artists like to impress you with how they look. They know that people think that if people have nice/expensive clothing, shoes, cars, etc. People think they must be successful. That not always true.

• Talk About How Wealthy They Are

Con Artists talk about how they bought three houses last month, own two exotic cars, took trips to Europe... all to impress you and make you think that their investment will provide you with similar wealth.

CON ARTISTS ARE FAIR WEATHER FRIENDS

• Once You Invest, They Are No Longer Friendly Or Come Around

Always follow up with your investments. Especially if it’s your first time investing with a person, follow up the next day or so.

HOW TO PROTECT YOURSELF

• Do Your Homework

An opportunity missed is better than losing your life savings.

• Check With State Regulators

Explain what we do in SCB, SEB and the Investor Educations Program.

• Check With Better Business Bureau

A good resource for complaints.

• Ask For Things In Writing

If they can’t put it in writing, then it is probably untrue.

• Understand What You Are Investing In

Never give money to someone unless you know what they are going to do with it.

• Don’t Be A “Courtesy Victim”

Older generations are thought to have courtesy, be respectful and trusting. You can’t be like that with today. Con artists know this and will use this to there advantage.

• Always Stay In Charge Of Your Money

Stay involved, ask question, know what you are getting yourself into, etc. Remember, its your money!

• Never Judge A Person’s Integrity By How They Look & Sound

Don’t be fooled. Con artists come in every shape and size.

• Monitor Your Investments

Review your monthly or quarterly statements. Look for descrepencies or big increase/losses. Don’t be afraid to ask the company to explain themselves.

• Don’t Be Afraid To Report Fraud

Often times, victims are reluctant to report fraud. This makes it difficult to prosecute fraud.

REMEMBER

Read slide out loud.

After reading “Your Greatest Protector Against Fraud...”

[ Wait for audience to answer... then click for answer ]

[ Go to next slide ] - Display Contact Information

IN CLOSING

Question & Answers

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