The Financial Industry Regulatory Authority (FINRA) announced two new online tools aimed at helping investors find and protect themselves against fraud.
Alert tool assists investors by explaining the characteristics of the most commonly used securities frauds. Relying on the research supported by the FINRA Investor Education Foundation, the tool clarifies persuasion tactics used by fraudsters. These persuasion tactics are constant across a wide variety of frauds.
Scam Meter and Risk Meter tools offered help investors evaluate the investment projects they are considering, and determines if the project is too good to be real. Moreover, the tools concentrate on the user’s behavioral traits.
Additionally, Alert provides links to online tools that can enable investors to check the background of investment professionals (including brokers, investment advisers or insurance agents), and investigate investments. There are also links where unsatisfied investors can file a complaint. Investors can also find a series of red flag warnings on investments that offer guarantees on the investments, are not registered, and deliver overly consistent returns, regardless of market conditions.