Beware of potential scams when investing. Trouble is a friend or foe?

There has been a small discussion on potential scams recently. I've written first on Gold scams in the past here. There was even a family that lost close to a Million in the Gold scam.

So you may ask how do we know if it's a potential scam?

One thing to take note is these companies may not look like scams at first. They actually promise the payout to investors and many got their promised interest. It's only after awhile that the whole thing collapse. Maybe that's their way of attracting more potential victims before disappearing into thin air.

Most of these potential scams offer high return rates on investment. They can be in the range of 12% to 24% return in the period of 1-2 years. I can only say if something is too good to be true, then most likely it is. When faced with this, always question where they invest the money and how are they able to generate the returns? Is the business sustainable?

Take the example of past scams like the popular sunshine empire. It promised high rates of return and you could get back all your investment capital within 10 months. That is a 100% return in 10 month. Sound too good to be true?

One thing you can do is to check if the company is under the MAS alert list here: http://www.mas.gov.sg/IAL.aspx?sc_p=A

According to MAS:
"The Investor Alert List provides a listing of unregulated persons who, based on information received by MAS, may have been wrongly perceived as being licensed or authorised by MAS."

What i can say is do not be greedy in investing. If there are doubts, question them and if you do not get satisfactory answers, its safer to stay out. There has been many overseas property investments recently which promised returns of 12% a year or even 24%. Some of these companies are on the MAS alert list too. I will not state them out but if you do encounter them, take extra caution.

A nice song to end this post. Coincidently i was listening to this song and it sort of relates to this post. Enjoy!

Trouble is a friend or foe? Don't let trouble be your friend.

)

Enjoyed my articles? 

You can Subscribe to SG Young Investment by Email 
or follow me on my Facebook page and get notified about new posts.