Today, DFI and the North American Securities Administrators Association (NASAA) released tips on how to avoid social networking investment scams.
While social networking helps connect people with others who share similar interests or views, con artists infiltrate these social networks looking for victims.
By joining and actively participating in a social network or community, the con artist builds credibility and gains the trust of other members of the group.
The con artist takes advantage of how easily people share background and personal information online and uses it to make a skillful and highly targeted pitch. The scam can spread rapidly through a social network as the con artist gains access to the friends and colleagues of the initial target.
Before you invest, evaluate every investment opportunity in the virtual world the same way you would in the real world. Verify that the individual selling the investment is licensed with DFI and that you understand the risks of the investment.
Visit the DFI website www.dfi.wa.gov for more tips on recognizing, avoiding and reporting investment fraud. To verify a license call 1.877.RING DFI (746-4334).
To view more tips on avoiding social networking scams visit www.dfi.wa.gov/consumers/education/investments/social-networks.htm