The FBI has recently released some sobering statistics, for anyone who is planning to make any large investments any time in the near future. According to recent reports, investigations by the FBI into commodities and securities fraud have become 50% more common.
Of course, that could mean one of 2 things: Either commodities and securities fraud have become 50% more common, or the FBI is taking them more seriously and simply investigating more of the cases. Realistically, it is probably some combination of the 2.
Regardless, commodities and securities fraud are both very common, and warrant some caution. Both of those are actual rather broad categories of scams, including many better known sub-categories. One of the most common forms of securities fraud is called affinity fraud, named because it relies on a potential investor forming a trust, or “affinity,” to the scammer, with the hope that they will trust their money to them as well.
Another common form of investment fraud is called prime bank investment fraud, which is where investors will be part of a small, exclusive group, which has special access to investments.
Part of the reason that the FBI suspects that are seeing instances of white collar crime such as this increasing lately is the economy. It is no mystery that the economy is suffering, which the FBI believes is driving individuals to look for better financial returns for their investments, which inevitably means greater risk, and greater risk of fraudulent investing.
It is not always worth the extra risk, though, as New Jersey Bureau of Securities Chief Abbe Tiger points out: “The interest rates are very, very low, unfortunately, that people can get on conservative investments and everybody is looking to bring a higher yield. But, you must really be careful because instead of bringing a higher yield, you could lose everything.”