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Consumer fraud series: High yield investment fraud

On Behalf of | Aug 9, 2018 | Consumer Fraud

In the fifth and final installment of our consumer fraud series, we are going to discuss high yield investment fraud. Although it can happen to anyone, this type of fraud is more common among those in a higher income class. In addition, victims can be non-profits, charitable organizations, or even municipalities. The reason is that those individuals or organizations are more likely to show interest in a high yield investment opportunity.

So, what does “high yield” mean? A high yield investment in one in which the investor is promised a large return on investment. However, the financial instruments offered in these scams are fake, though they appear to be from a top world bank, also called a prime bank by the SEC. This means that they do not exist in the banking system and have been created by the scammer for the appearance of legitimacy. Therefore, when an investor hands over money and accepts these instruments, a scammer can then disappear with the money. The investor does not receive any kind of return and loses their initial investment. Often, that initial investment can be thousands of dollars, if not more.

These types of scammers are among the boldest, even going as far as to advertise services in national media. They are well-versed in making an investment look exclusive and making the investor feel as if they have been specially chosen for such an amazing opportunity. When questioned about the involvement of banks or other parties, these expertly trained scammers can easily divert the question or make the investor believe they will not understand the complexity of the details.

High yield investment schemes often involve millions of dollars from hundreds of investors by the time they are uncovered and reported to the SEC. If you have been the victim of such a scam, contact an attorney immediately to begin the process of retrieving your lost funds. In some cases of this nature, consumers have lost their entire life savings or retirement funds. Do not delay in getting help should you find yourself the victim of such a heinous fraudulent act.