Investment decision making

Question
I was invited to a free investment seminar where the speaker punted a property fund which he said provided brilliant returns. I posed some questions but got some vague answers. I didn’t commit to investing anything there and then. However, as I left my contact details this organisation is now calling me and pressuring me to invest. The deal sounds good – what should I do?

 
Answer
If you already have reservations, my advice is to walk away. The old adage of ‘if it sounds too good to be true – it usually is’ applies here. Scamsters come in all shapes and sizes and are known to lure investors in with promises of good returns and island holidays. But sadly very few of these promises materialise – if ever. They are also known to push people to commit and it sounds to me like this company and its people are doing just that. If you are still intrigued by the offer, I would advise that you do some stringent research into the company and its people before you part with any of your hard earned cash. Ask for written confirmation and physical contact details of the company/person that is offering you the investment opportunity. Ask the company what agencies they are regulated by or registered with. Follow this up by contacting the relevant agency or regulator to confirm whether they are telling the truth. If it all still sounds legitimate, request additional copies of the documentation so you can check the information with a financial advisor, banker or lawyer. Scam artists usually get very nervous if they are approached for this type of information and if they are hesitant about you asking for a second opinion – walk away. If you believe you have uncovered a scam report it to the Financial Services Board (FSB) or the Financial Intermediaries Association of Southern Africa (FIA) has recently created a ‘Watchdog’, which can investigate fraud and scams. Complaints, queries and requests for further information can be addressed to Joe Kotzé, national manager: Compliance, at joe@fia.org.za or 012 665 0085.
 
Expert
Angelique Ruzicka
Consumer Finance Expert
Justmoney

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