Boomers who lost money in retirement funds and other investments are prime targets for scams. AARP, the North Carolina Secretary of State’s office and the Financial Investment Regulatory Authority are teaming together in an “Outsmarting Investment Fraud” campaign.

Summary:
• Investment fraudsters are looking for older people with money trying to recoup recent losses.
• The “Outsmarting Investment Fraud” program aims to teach ways to avoid being scammed.
• AARP and the Financial Industry Regulatory Authority offer tips including: know whom you’re dealing with.

In this economic downturn, you may be trying to figure out how to regain some of the money lost on your retirement fund and other investments. Keep your guard up: Investment fraudsters are looking for their next victims.

“Seniors are the folks with the money,” North Carolina Secretary of State Elaine F. Marshall said. “People know that very well.”

Be cautious of “free lunch” seminars, people claiming to be “certified senior financial advisers” (a designation not recognized by any state) and anyone selling products they claim are risk-free or guaranteed. Most important, always check to make sure the person pitching an investment product is licensed and the product is registered. [See below.]

A new campaign called “Outsmarting Investment Fraud” aims to teach a few of these lessons. Campaign participants include AARP, the North Carolina Secretary of State’s office and the Financial Industry Regulatory Authority (FINRA), an independent regulator for securities firms.

You can register online for a public workshop Nov. 3 at the Greensboro Marriott Downtown or you can call 1-866-862-0110 toll-free.

“The investment fraud folks are just as wily and creative in their approach to this as other scammers are. They just do it in a more polished way,” said Helen Savage, AARP North Carolina associate state director for community outreach. “There really is a need for people to be knowledgeable, to recognize the tactics that investment fraud scammers use.”

About two dozen AARP volunteers have been trained in the basics of investment fraud so they can host seminars for neighborhood, church, community and other groups. To request a speaker or to become a volunteer with the program, call Helen Savage at 1-866-389-5650 toll-free.

For the year that ended in June, the Secretary of State’s office recorded 22 cases of investment fraud in which criminal or administrative enforcement action was taken; 18 involved investors over the age of 50.

That’s not surprising, Savage said. The typical investment fraud target is a college-educated man, 55 to 65, who is married, has had a recent health or financial setback, is financially literate and is a risk taker.

“They tend to have great faith in their own ability to detect something that is not aboveboard,” she said.

Older victims are attractive to scammers because they typically have worked most of their lives, have a retirement nest egg, are transitioning out of the workforce or may be looking for new investment opportunities, said John M. Gannon, president of FINRA’s Investor Education Foundation.

Here are a few red flags:

• Claims of guaranteed returns. Very few investments have a guaranteed return.

• Limited time offers. Be cautious of people who pressure you to make up your mind right away or by a certain date.

• Secret deals. Take heed when someone pitches a product and then warns you not to tell others.

• Offshore and foreign currency. “That offshore stuff is like the wild, wild West,” Marshall said.

• “Free-lunch” seminars. People conducting seminars “may be using persuasion or psychological tactics to persuade you to make an emotional, rather than a logical, decision to purchase an investment product,” Gannon said. AARP recruits volunteers to attend these seminars; go online to learn how to volunteer to be an AARP Free Lunch monitor or call Helen Savage at 1-866-389-5650 toll-free.

Before you invest, take these simple steps:

• Check online to make sure any broker or investment adviser is properly registered with the North Carolina Secretary of State or call the office at 1-800-688-4507.

• Ask and verify that the investment salesperson is licensed with FINRA and check to see if the investment product is registered with the Securities and Exchange Commission.

• Check the FINRA Investor Education Foundation’s online information on how to avoid investment fraud and learn how to protect yourself.

• Check on the latest investment scams in the Scam Alert archives of the AARP Bulletin.

Natalie Gott has covered government and policy for seven years. She is based in Chapel Hill.