Free lunch seminars are a rapidly expanding tactic as investment salespeople target the estimated $15 trillion in assets controlled by Americans 65 and older. The aging bubble of wealthy Baby Boomers makes them "prime targets for scam artists," says SEC Chairman Christopher Cox.
What really happens when you trade surf-and-turf for a sales pitch?
"Huge percentages of these things give out false information, make misrepresentations and sucker seniors in," says Joseph Borg of the North American Securities Administrators Association, which is made up of state securities regulators.
The pressure to reciprocate for even small favors can be a powerful tool in the hands of a con artist, according to an investment-fraud study in 2006 by the Financial Industry Regulatory Authority Investor Education Foundation.
Here are some useful Websites on avoiding trouble:
The SEC online booklet on scams that are targeting seniors is at: www.sec.gov/investor/seniors.shtml
Brokerage regulator Finra's guide to decoding salespeople's credentials is at this long address: http://apps.finra.org/datadirectory/1/prodesignations.aspx
The AARP Website, www.AARP.org offers tips on avoiding dubious retirement investments.
Source: The Wall Street Journal, September 8, 2007
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