Three New Stock Market Scams to Avoid-May 5, 2022 14:25

(Photo provider: Adobe Stock-)

(Photo provider: Adobe Stock-)

In recent years, financial fraud has increased. It must be said that two factors are increasing fraud: on the one hand, the increase in financial players: online banks, neobanks and fintechs, online brokers and other online distributors of financial products, etc. Meanwhile, the digitization of finance and the nearly systematic use of the Internet for investment applications, tracking its evolution, obtaining information, discovering new investment ideas, etc.

In this regard, all types of fraudulent investment and financial fraud are exploding. Discover three new stock exchange scams to avoid. It is an explanation to find them and not fall into a trap.

Discounted stock

Autorité des Marchés Financiers (AMF) warned about this most recent scam a few months ago, the purchase of discounted stock. Note, it’s brand new, and it’s never a good investment idea as it simply doesn’t exist. If you are offered to buy a listed company’s stock at a price lower than the listed price, it is a fraud. It is not possible to buy company stock directly at a lower price than the market. Only informed investors can indirectly buy stock in a company at a price lower than the market price, for example using options.

However, this is not what scammers offer you and will hang stock purchases of large French and foreign companies at prices below their stock market prices. These proposals are in the form of fake stock purchase agreements and aim to withdraw money from you that will not be used to purchase stock. Once the payment is complete, you will no longer be able to collect the amount you paid or join the scammer.

To buy stock, choose your bank, or a well-known and recognized stockbroker that is licensed, regulated and headquartered in the European Union.

Inflation-indexed bond booklet

Another Topic Scam: A Fake Inflation-Linked Booklet. If regulated savings accounts such as Libre A, LDSS, LEP are partially indexed to inflation, they will not offer interest rates above inflation. And it’s the same for all “house” savings books in banks (except for special offers with boosted rates that only occasionally last for a few months). Therefore, all of these investments with risk-free guaranteed capital have an interest rate of no more than 1% (the unpaid amount is very limited and is reserved for the lowest income of 2.2% Livret d. ‘Excluding Epargne Populaire).

It is impossible to find a savings or capital-guaranteed bank account whose inflation rate is linked to inflation so that purchasing power does not decline. This type of investment proposal is a scam. Not only will you not be able to benefit from the interest rates displayed, but you will also be unable to recover the amount paid by the scammers behind the fake passbook offer.

Beware of solicitations and cold calls on the internet. The placement must come from your own initiative. In the case of solicitation, always make sure that the intermediary is fully accredited. Especially if it is a financial agent that is displayed in the REGAFI register. If you are an insurance company, it must be listed in the ACPR register. And if it is a financial intermediary, it will appear in the ORIAS register.

Tips from influencers

Finally, with regard to current stock markets and financial fraud, it’s hard to say a word about influencers who flock to social networks to praise this investment and its benefits, without clarifying its motives. .. Some categories of influencers should be avoided.

First, don’t give credit to your financial investment ads if it comes from very mainstream influencers who aren’t your core business. On the one hand, he has no special expertise on this subject. On the other hand, he often gets paid (even if he doesn’t say so) to promote to a very large community. Therefore, Kim Kardashian or Navira promoted the crypto or cryptocurrency exchange platform not because of the quality of the investment offered, but because of the checks that accompany it.

Also note the stock market and financial influential people who know nothing about it and offer fantasy and sometimes very harmful advice to their followers. Influencers, in particular, may ignore the risk of exclusively presenting the potential for profit.

Finally, beware of scammers who try to artificially raise the price of an asset by selling it to their followers, earning significant capital gains behind them and reselling it.

Remember that you cannot improvise as a financial investment adviser. This regulated profession includes insurance, professional associations, organization registration for single insurance registration, banks and financial intermediaries. But above all, respect a certain number of rules of good deeds and ethics.

Do you still want to follow investment and market news on social networks? Prioritize known and recognized actors such as financial journalists, analysts and economists. To keep the news from the financial sector up to date.