Travis Financial Services–

Investment Scams: 7 Common Red Flags

Investing your money is a great way to prepare for retirement and help your financial goals. While investing is vital for smart saving, not all investments are on the up and up. While there is always some degree of risk when investing any funds, some investment opportunities are actually scams designed to steal investors' money. It is essential to know how to spot one before you give them your money. Below are some of the red flags you may find with investment scams.

1. A Promise of a High Return With Minimal Risk

The level of risk with investments generally is most often related to the size of the return. The greater the return, the greater the risk. If you are being told that there’s little or no risk, the investment may be a scam.¹

2. The Investment Was Unsolicited

Investments are often brought to you by a financial professional or in response to your inquiry. If you are offered an investment you did not inquire about from someone other than your trusted financial professional, you should proceed cautiously.²

3. They Are Using Aggressive Sales Tactics

To ensure that investors fall for their scam, scam artists will become aggressive to get you to close the deal. They may refer to the investment as the opportunity of a lifetime and pressure you to invest quickly without researching. Reputable financial professionals will let you take the time to research the investment so that you understand the potential risk and rewards. If you feel pressured to make a decision, you should walk away.²

4. They Are Asking for Non-Standard Payment Methods

Most investments are handled by check or bank transfer to a U.S.-based account. Scam artists may tell you to wire transfer your money to an overseas account or use more unconventional payment methods, such as cash or gift cards. These payment methods will leave you little recourse if the investment turns out to be a scam, and you will likely not recover your money.¹

5. They Are Not Registered Professionals

A large percentage of investment fraud is committed by unregistered persons. To help avoid the risk of falling prey to an investment scam, you should only invest with financial professionals who and properly licensed and registered.¹

6. The Sales Documents Are Sloppy or Have Errors

You should not enter into any investment where the details or sales order are not in writing. If you are refused documents, the investment is likely a scam. If you are given sales documents, read through them carefully. Everything should be clearly stated and free of spelling or grammatical errors.²

7. No One Else is Involved in the Investment

With many investments, there will be multiple parties involved in the deal. This may include accountants, law firms, or brokerage firms. If no one else is involved in the investment, or you are told not to contact any other parties involved, it could be a red flag that the investment is a scam.²

Important Disclosures
Content in this material is for educational and general information only and not intended to provide specific advice or recommendations for any individual.
Investing involves risks including possible loss of principal.
 All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
This article was prepared by WriterAccess.
LPL Tracking #1-05377994

1. “Red Flags of Investment Fraud Checklist,”
2. “Investor Alert: 10 Red Flags That an Unregistered Offering May Be a Scam,”

Check the background of investment professionals associated with this site on FINRA’s BrokerCheck.

The financial consultants at Travis Financial Services are registered representatives with, and securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA / SIPC). Insurance products are offered through LPL or its licensed affiliates. Travis Credit Union and Travis Financial Services are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Travis Financial Services, and may also be employees of Travis Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Travis Credit Union or Travis Financial Services. Securities and insurance offered through LPL or its affiliates are:

Not Insured by NCUA or any other Government Agency

Not Credit Union Guaranteed

Not Credit Union Deposits or Obligations

May Lose Value

The LPL Financial registered representatives associated with this website may discuss and/or transact business only with the states in which they are properly registered or licensed. No offers may be made or accepted from any resident of any other state.

The "Contact TFS" and "Login to Your Account" links are provided as a convenient connection between the websites belonging to Travis Credit Union and its business partner. The policies and procedures in use at our business partner may differ from those in use at Travis Credit Union. Travis Credit Union is not responsible for the content contained in our business partner website.

Forbes Top 10 Credit Unions in California Award
Desjardins Financial Education Award, 1st place nationwide, adult and youth
US Air Force Distinguished Credit Union of the Year
Travis Credit Union footer small logo

Routing 321170839

© 2024 Travis Credit Union. All Rights Reserved.

Privacy Policy | Third-Party Sites | CCPA | Notice at Collection | Home Mortgage Disclosure Act Notice 
Avoid Foreclosure | Disclosures | Online Security & Safety and How We Protect You | Service of Process

By continuing to use this site, you agree to our use of cookies as described in our Online Privacy Policy.

If you are using a screen reader or other auxiliary aid and are having problems using this website,
please call 1-800-877-8328 for assistance.

NCUA logo footer

This Credit Union is federally insured by the National Credit Union Administration.