SmartCheck.Cftc.Gov Logo


Five ways to protect your investments in 2017

Posted by DRutherford /
2017 resolve to protect

Many people make New Year’s resolutions about money, but few resolve to stay on guard against fraud. That’s because, for the most part, people believe it will never happen to them.

Unfortunately, it can and does. According to the Financial Fraud Research Center, approximately $50 billion is lost to fraud in the United States every year. That includes all kinds of fraud, from email scams and identity theft to investment fraud. The amount actually lost is difficult to pinpoint because many cases never get reported.

Fraud isn’t about being gullible or greedy. It’s about emotion. Con artists are professionals who know how to push the right psychological buttons to get you to believe “too good to be true” is good enough to be real. If they sense you’re seeking security, they’ll promise risk-free guarantees. If they feel you want big returns, they’ll offer to double your money in six months or a year. They will say whatever it takes to get your attention. Once they have your attention, they start to work on building your interest and gaining your trust.

But there are several steps you can take to help avoid fraud. Here are five you should resolve to do before January ends.

1. Block unwanted calls

Many frauds start with a cold call, and the best way to deal with cold calls is not to answer them.

To help, register or verify your phone number is included in the Federal Trade Commission’s Do Not Call Registry.

Once you add your number to the registry, it takes about 30 days for telemarketers to stop calling. After that time, you can assume any sales call is violating the law. Remember, though, that the registry only stops sales calls. It does not stop calls from charities, political organizations, bill collectors, or surveys, and many fraudsters will pose as those entities too.

There are also a number of phones and devices that will let you screen or block calls, or you can contact your telephone service provider and ask it to block nuisance callers.

If you do find yourself on the line with someone asking for money, tell them you never give financial or personal information over the phone and hang up. Also remember that no government agency, bank or other legitimate financial services company would ever call you and ask for account information or unusual forms of payment, like wire transfers or mailing prepaid credit cards. If that happens, hang up and call the customer service number on your account statement or dot-gov website if you have concerns.

2. Stop mass mail

Earlier this year, the U.S. Commodity Futures Trading Commission joined with the Department of Justice, the U.S. Postal Inspector and others to help stop mass mail frauds. Like cold calls, mass-mailed letters regularly carry fraudulent messages of huge wealth overnight or sure-fire investment opportunities. You should beware of any piece of mail you receive that promises free money.

One way to help cut through the clutter is to reduce your junk mail. The Direct Marketing Association's Mail Preference Service lets you opt out of receiving unsolicited commercial mail from many national companies for five years. You can also visit to stop pre-screened credit and insurance offers.

For more tips, visit the FTC’s website on stopping junk mail, and if you receive mail you suspect is a fraud, report it to the U.S. Postal Inspection Service.

3. Open and carefully review your statements every month

Investors should regularly open and review their monthly or quarterly statements. Many Ponzi schemes and other frauds have been detected because the numbers just don’t add up. Some fraudsters don’t even take the time to use spellcheck or do a sloppy job of inserting charts, graphs, logos or other information. Sloppy or unprofessional statements and disclosures are a big red flag that you may be involved with a fraud.

Even if you are dealing with a professional firm, you will still want to watch for unauthorized trades, or unknown fees. Always keep your statement until the next one arrives so you can compare ending and starting balances as well as gains and losses. For more on reviewing account statements, see this FINRA investor alert.

4. Research investments using impartial sources

Before you make any investment, be sure you receive the proper disclosure documents and read them thoroughly. Ask these questions:

  • Is the investment properly registered with state or federal agencies?
  • How does the investment make money? (If it isn’t clear, stay away.)
  • What are the downside risks? How could the investment lose money, and how likely could those things happen?
  • What is the cost to buy, maintain, and sell the investment? What are the fees and costs?
  • How liquid is the investment? Could you get out quickly if you need to?
  • Does the investment match your goals and risk tolerance?

It’s also important to verify the information you are given with independent and unbiased sources. For example, if you’re told an investment in gold holds its value no matter what happens to world economy, check out that claim by looking at historical prices. If you do, you’ll see that prices fluctuate a great deal and are impacted significantly by world events. If you need help identifying resources, visit your local library’s business or reference department.

Talk the investment over with others you trust – like a lawyer, your accountant, spouse or adult children. They could raise more questions and issues to consider. If someone selling an investment tells you to keep the offer a secret, walk away. That is another red flag it could be a fraud.

5. Be sure the people and firms you deal with are properly registered

Finally, check the registration of the people you trust with your money, and recheck them at least once a year. The resources featured on will help you determine if the professionals and firms you’re dealing with are properly registered and if they have black marks on their records you should know about.


Stay Connected.

Get the latest SmartCheck news sent to your inbox.

Sign Up

Run a Check.
Know Your Pro.

Investing can be risky. Make sure your financial professional is properly registered and check their disciplinary history.


Spot something? Speak up.

Sketchy offer? Shifty sales tactics?

Give a tip to the CFTC.

Submit a Tip