Investment Seminar Scams

This market is good for scammers.

When the market tightens two things happen. Agent numbers fall and scammers or sprukers come to the surface.

It is appealing because the offers are so convincing and after all who doesn’t want a good deal.

While there are some good opportunities to invest in real estate right now, you should be wary of ‘the chance of a lifetime’ offers and seminars that promote ‘no risk investments’. There is no such thing.

While good investment advice from qualified professionals is legitimate and beneficial, it is important to look carefully at what an investment scheme or seminar is offering. Attending an expensive seminar or investing in the wrong kind of scheme can be a costly mistake.

You could be invited to an investment seminar by receiving a letter, see an ad in a paper or magazine, be invited by a telemarketer or hear about it through word of mouth. The seminar may promise that a motivational speaker, an investment expert or even a self-made millionaire who will give ‘advice on investing’.

Those to watch out for are the ones that offer ‘to do it all’. Find the property, arrange the finance, get it rented and have it managed. Then there are those that offer rental guarantees or special incentives to buy off the plan.

Do the sums, investigate what they are saying and do some homework before committing. You might find that they don’t deliver the benefits they promise when the total cost of the deal is taken into account.

Some seminars or schemes may even fly you to the property location to view the property. They will try to pressure you into committing to the deal—without giving you time to obtain independent information or advice.

Here are some warning signs.

• Seminars that promise a ‘risk-free investment’ ‘how I bought 100 properties in 5 years’ and ‘get-rich-quick schemes’.
• Lengthy rental guarantees that offer positive gearing.
• Seminars offering special developer stock at below cost prices.
• Packages that include financing, legals and all fees.

Ways to protect yourself.
• Do you homework.
• Never commit at the seminar. Give yourself time to think and make your own enquiries
• Always get independent financial advice.
• Just because a friend or family member thiks it is a good idea, you should seek independent advice (from a lawyer or financial adviser)
• Be wary of investments promising a high return with little or no risk.
• NEVER reply to a spam email (even to unsubscribe).
• Check the promoters out with ASIC and the ACCC.

Report them. If you think what you are being offered is a scam, then report them.

If it looks too good to be true – it probably is!

Kevin Turner | RealEstateTalk Host
Sellers Guide–appointing the best agent and how to make sure you get top dollar in any market.
[email protected] | Twitter: @Realestatetalk