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In the News : SAIF
Publication: Times-Standard
By: Suzie Owsley
Date: November 8, 2003
Don't invest until you investigate
"I am a chameleon. ... Your views are my views. Eventually you will trust me. I will be a friend, not a stranger. I got you right where I want you."
These are the words of Steven Michaels, a fraudulent telemarketer being interviewed about the phone scams he perpetrated on thousands of victims. Michaels goes on to say that the people he victimizes over the phone do not exist as people, they are only voices. He has no problem wiping out their savings accounts.
The Department of Corporations is educating senior citizens about financial and telemarketing crimes through their SAIF program, Seniors Against Investment Fraud. The program is an outreach campaign led by the Department of Corporations. The purpose of SAIF is to teach California's senior citizens how to detect, stop and avoid telemarketing fraud.
SAIF's catch phrase is "Don't Invest Until You Investigate." What do you have to lose -- besides your entire life savings! SAIF recommends calling the Department of Corporations before purchasing any type of financial product or service. The department can provide background information on the financial company before you invest. It can also identify red flags that might be associated with the company.
Another investment rule to remember is don't be too trusting. Appearances can be deceiving. Often, the nicer and more professional the salesperson appears, the greater the con artist. Slow down and take your time. Do not make quick decisions no matter how enticing the investment appears. Most fraud occurs because the con artist talks the victim into making a rushed decision.
Anyone considering an investment should be aware of guaranteed large rates of returns. There are always risks involved. If you are promised a high return rate, be extremely cautious. Think about how many years it took to save the money you have. How much money are you willing to lose if the investment turns out to be a scam? Are you investing your entire life savings?
The Department of Corporations also offers these investor self-defense tips. Don't be a "courtesy victim." Con artists don't hesitate to take advantage of people with good manners, who fear they are being rude by hanging up or saying no to the caller's sales pitches. When in doubt about a telemarketing call or personal visit, make no promises or commitments. A stranger either on the phone or at your door should be regarded with the utmost caution. It is better to hold off on an investment you're unsure of than it is to make a commitment and lose everything. In these circumstances it is not impolite to say that you are not interested. Be firm. Do not let someone talk you into a financial deal.
Beware unsolicited phone calls, letters or personal visits from strangers wanting to sell an investment plan. If the person offering the financial deal is not willing to allow you time to investigate the salesperson, firm and the opportunity itself, there could be something fraudulent taking place.
Before making any financial planning commitments, get a professional opinion. Ask your attorney, stockbroker, accountant or other reliable consultant about the investment. Don't be afraid to discuss the investment with others. By keeping the information secret and away from family and friends, you may be doing more harm than good. Make sure you clearly understand and receive a written copy of the investment. Understand the terms and conditions of the transaction clearly. Demand a copy of the complete information including the risks, obligations and any costs associated with the investment. The company should also supply complete information in writing about commissions, sales charges and service fees.
A study conducted by the Department of Corporations found that 70 percent of Californians over the age of 50 have been approached by a fraudulent individual. Billions have been lost to these shady deals. Seniors are sometimes preyed upon as possible victims because of their vulnerability and willingness to trust others. They are usually home during the day and many have disposable incomes.
Take the time to talk to your senior family members, friends and associates. Encourage them to contact the Department of Corporations before making that investment. Don't allow our seniors to become victims.
The Department of Corporations Seniors Against Investment Fraud program can be reached toll-free at * (866) SAIF-CORP or on the Internet at www.corp.ca.gov.
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* Editor's Note: The correct number to reach the California Department of Corporations Seniors Against Investment Fraud Program is 1-866-ASK-CORP (1-866-275-2677).
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