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The national registration search contains the names of all individuals and firms who are registered to sell securities in Canada, with the exception of those registered solely with the Ontario Securities Commision (OSC).

ASC ExternalSite > Investors > Investor Resources > You ASC'd Blog > Posts > Top five investment risks to watch out for in 2019

January 02
Top five investment risks to watch out for in 2019

2019 Highway with Mountains blog.jpg

To help Albertans invest their hard-earned money wisely, we have identified the top five risks in 2019 based on information gathered by our Enforcement team.

• A Wolf in Sheep’s Clothing? The number of complaints relating to private, high-risk investments promising high returns that are marketed as low-risk are on the rise in Alberta. Before you’re tempted to believe a “too good to be true” offer, remember the relationship between risk versus reward – generally, the higher the potential reward, the higher the risk that you could lose some or all of your investment. These schemes are often marketed as “how the wealthy make their money,” or an “exclusive opportunity” – which are simply high-pressure sales tactics.

• My friends can’t be wrong. Affinity fraud continues to be an issue in many jurisdictions around the world, including Alberta. With affinity fraud, victims are introduced to scams by someone they trust – family, friends or co-workers –and invest based on their recommendation. In Alberta, religious affiliation is currently a common link between victim and perpetrator. Research and checking registration before investing are important steps to avoid becoming a victim.

• Psst -- I know something no one else does! This could be a high-pressure sales tactic used by scam artists, or it could be illegal insider trading. Illegal insider trading is when important, non-public information about a company is used to profit from trading in the company’s stock. It can be done by anyone including company executives or employees, their friends and relatives, or even an average person on the street – if material, non-public information is used. In Alberta, employees who suspect insider trading or other securities law violations by their employer can now act as a “whistleblower.” The ASC’s new whistleblower program enables individuals to provide critical information about securities misconduct and without fear of reprisal.

• Don’t miss this new opportunity! The latest trends can often offer exciting investment opportunities, but they also attract scam artists who build schemes around the latest trends because there is limited information available to vet the opportunity. Our Enforcement division has recently been tracking potential scams related to cannabis and cryptoasset investments. Take your time and make sure you truly understand the investment before handing over your money.

• Trust me, I’m authorized to sell this investment. Did you know that, generally, anyone who offers investment opportunities in Alberta must be registered to do so? Scam artists hope you don’t, so they can continue to profit. Reports of non-registered individuals selling investments are on the rise. Make sure you verify the registration of any advisor or organization using before you invest

Remember -- if it sounds too good to be true, it probably is.

There is a lot to learn about investing beyond just the current risks. Consider brushing up on your financial knowledge by reviewing some of the ASC’s free resources or previous blog posts. If you have a topic you’d like to see us blog about, let us know via social media or our public inquiries office — we’re here and we’re listening. All the best of the New Year, and let us know how we can help!

Helpful links
Red Flags of Fraud