“Hello, I am going to make you RICH!” “Quick easy money!” “Double your money!”
“Guaranteed!” and lastly the famous catchphrase “Power!,Power!,Power!”(so irritating!)
Hey guys! Seem familiar? Have you ever heard any of these catchphrases? If you have, then you’re definitely being scammed. Well, at least now you’re aware, besides, you’re not the only person who’s been scammed in this world.
Lemme share with you my experience.
A new friend of mine invited me to his birthday celebration. Did I accept the invitation?
Yes, of course! Who doesn’t love free food?
When I arrived at the meetup spot, I felt something was odd… It was no Birthday Party… it turned out to be an Investment Seminar “celebration.” (That was awkward!)
The “magic” began after an hour of brainstorming, they insisted that I invest in their system and invite more people or “downlines” to earn more money (Wow Power!).
Hey, I was only 16 at the time, so I easily got lured since the promised returns were too great.
After a month, I contacted my recruiter to ask for my returns and sad to say no one ever heard of me investing with them(OUCH!). I was shocked and I didn’t know what to do, I wasted my entire savings on them(duh donations!). After a year, I found out the firm closed down after being filed an administrative complaint. Lesson learned: never trust someone easily and do a background check before you invest.
In our current time, you do know scammers are getting harder and harder to tell because they are getting trickier than before. So a word of advice: “You should be Financially Literate”. Here’s a guideline “THINK- EXAMINE – STUDY – DECIDE”
Let’s move on to my point. Now, the SEC (Securities and Exchange Commission) has three missions: (i) Protect investors, (ii) Maintain fair, orderly, and efficient markets, and (iii) to Facilitate Capital Formation. The SEC does its best to keep Filipinos informed on potential investment scams.
Fore more information on latest announcement here is the website https://www.sec.gov.ph/announcements/
And here is an Investment Scam Checklist of the SEC Investment Scam Checklist. Source : http://www.sec.gov.ph
However, what if the SEC or other regulators aren’t there to warn us? Lemme give you some tips on how to tell if it’s a Scam:
The business is not registered with SEC nor DTI
Whenever a random person offers high or miraculous earnings on investment or business opportunities, make sure you keep asking questions until you are satisfied with the information.
Ask them if their company is registered. There’s nothing wrong with asking if they’re real or legitimate, it’s for your own protection. If they won’t tell you then that’s a red flag. You also have the choice to just look up the company’s name at this website https://secexpress.ph/.
If they’re not listed or registered don’t ever give them your money, your information, and warn your friends, and your family against them. Most of all report them immediately to the SEC or DTI or call NBI or your local district police. Give them all the information you know about them. So that they can’t harm other people anymore.
GUARANTEED HIGH RETURNS (Ponzi Scheme)
We Filipinos love to hear this catchphrase “Guaranteed high returns” that’s why many of us easily get lured in. I believe that it’s mainly because of pure “Greed” on making quick easy money. Ponzi schemes lure you by promising a huge return in a short span of time, but the reality is whenever a new investor comes the old investors are being paid by them and that’s how the Ponzi scheme works.
The only person who makes money in these schemes is the owner of the Ponzi. If the owner is gone then there’s no other way but to go down with the other investors. If someone told you about this kind of high return investment most probably it is not true!. Always ask them how they get such returns.
Just remember this: there’s no such thing as “Guaranteed high return in investing”.
Recruiting is a MUST (Pyramid Scheme)
At some point in your life, a friend may have approached and shared an incredible investment or business opportunity to you. Always remember a company makes money by selling their product. If he presents you with an opportunity to make quick easy money by recruiting more people rather than selling the product then that’s a Pyramid scheme.
Pyramid consists of Downline(people you recruited) and Upline(people who recruited you first or Recruiter). Pyramid Schemes are always illegal, you must remember that the pyramid does not make money by selling a product but only make money by recruiting other members. So, once the chain becomes difficult to handle, the pyramid collapses.The people on the bottom of the pile will lose their investments Therefore, they are illegal.
If you ever encounter those kinds of business or investment strategy better think twice, trust your guts and follow your instincts to flee.
Word of advice: Don’t invest on what you don’t know. Before letting go of your hard earned money research the company first.
And that’s it, on how to pinpoint an investment scam. Though, there are more different strategies to determine investment scam, I only want to mention the most reliable information you need to know.
In next week’s column, I give the floor to Marke Arellano where he will discuss on PSE Index (valuable information). He is a broker from HDI Securites and a really good equity trader, you will learn a lot from him.
Disclaimer: We want to remind you, dear reader, that the content in this column is my opinion and AlphaEdge Research’s opinion only and should not be construed as investment advice because we’re not your financial adviser nor have we taken into consideration your personal objectives, financial situation, needs or circumstances as your fiduciary. This column is mainly for your entertainment and education only.
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