Preventing Investment Fraud

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There is no substitute for consisitently saving for retirement. Remember no one can predict the future.

If you are like most people, your initial reaction to the question posed by the title to this white paper is “no.”  However, for many investors, the answer is “yes.”  With all of the investment options available today, many investors are intimidated, confused  and frustrated by the investment process.  Recent studies also support the suggestion that many investors are perfect targets for investment fraudor already are victims of investment fraud. For instance,

  • A recent study by Schwab Institutional found that 75% of investor portfolioswere unsuitable for investors given their financial situation and goals.1  Based upon my personal experience, I would put that number at approximately 90% based on issues involving inadequate, or “pseudo,” diversification;
  • A recent study by CEG Worldwide concluded that over 94% of those holding themselves out as wealth managers were more product salesman than wealth manager2;
  • Investment fraud is the number crime against the elderly, affecting an estimated 7.3 million older Americans, or one out of every five senior citizens3. Since that number only counts the instances of fraud actually reported, the number of victims is undoubtedly higher.

During an economic crisis investment fraud surges. The chances of you getting rich quick are remote. As investors we cannot allow ourselves to deviate from our properly diversified portfolio and our long term goals.

Please comment or call to discuss.

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