India has already entered a new phase of investments in digital platforms. Yet, more sophisticated investing scams have also started cropping up more frequently these days. Scammers are preying on the desire to make a quick buck and this is often leading to huge financial losses for customers. In order to avoid these scenarios, you should know how to spot these scams early on. Here are some helpful insights in this regard.
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Promises of High Returns Without Risk
If someone guarantees amazing returns at no risk that’s your first clue. No legitimate investment comes without any risk. Genuine investments can fall or rise depending on the market situation, and any promise of unrealistically high returns is likely a lure to attract inexperienced and unsuspecting investors. By appealing to greed with “can’t afford to miss opportunities”, scammers trap the unwary investors. So, always be sceptical of such claims.
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Pushing for Immediate Investment
In most cases, pressure tactics are deployed by fraudsters who exhort people to invest right away, since opportunities may not be around for a long time. If there is any such pressure on you to invest your money without proper time to do due diligence, skip it right away. No matter how good something appears to be, you should only go ahead once you have checked the authenticity of the same.
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No Legitimate Registration
Make sure the company or platform publicising the investment complies with SEBI (Securities and Exchange Board of India) regulations. Scammers typically work through unregistered companies or platforms with unknown origins. You can verify the legitimacy of any investment entity through SEBI’s official website or any other relevant financial regulator.
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Lack of Disclosure on Investment Process
If you can’t get a full explanation of how the investment works, take a second look. Scammers often use complicated terms or murky means to confuse investors. A genuine consultant will explain the investment procedure in simple words and won’t dodge your questions.
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Insider Tips
Fraudulent brokers often talk about insider reports or freshly advertised investment opportunities. However, you should know that trading based on insider knowledge is illegal in India. Scammers in many cases pretend to be privy insiders to win your faith, but this is scam-like behaviour. Stick to the public, verified sources of information for your investment decisions.
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Investigate the Online Background
Before investing, research the company or individual providing the investment. Scammers frequently lack a sound online profile or have many negative reviews. Look for past complaints or shady transactions related to the organisation. All established platforms and consultants have a transparent and largely favourable online reputation.
How to Be Safe
- Educate Yourself: Keep current with new scams and understand the type of trickery that can destroy a good investment opportunity.
- Consultation with a Professional: Seek advice from appropriate financial advisors or other professionals backed by registered licences before making any sort of investment decisions.
- Trust Your Instincts: If it does not feel authentic, don’t sweep those suspicions under the carpet. Patience and hard work are the only ways to be wealthy.
Remember, there are no shortcuts in investments. With proper information and a sharp eye, you can shield yourself and your hard-earned capital from any investment scam.