Members attending Tuesday's monthly Desloge Chamber of Commerce luncheon learned about potential threats to the financial security of senior investors during a presentation given by guest speaker John Hale, state director of Investor Education.
Investor Education is a section of the Missouri Securities Division and under the Office of Secretary of State Jason Kander. The Securities Division is responsible for protecting Missouri investors from fraud; ensures that firms and individuals selling securities comply with the securities laws in the state; and enforces the Missouri Uniform Securities Act.
According to Hale, there are five major threats senior investors need to be on the lookout for.
The first is online discount brokerage accounts managed by third parties.
"You've likely heard of companies that allow individual investors the flexibility and platform to conduct their own stock trading and portfolio management through an online account," Hale said. "They typically operate on a minimum fee per trade payment structure. While there is little harm in having the assistance of an individual in setting up the account, using an individual without proper credentials or experience in trading to manage your account is a recipe for disaster."
Hale added that investors should avoid sharing their user name and password.
Second on the list are unregistered salespeople.
"Call the Missouri Securities Division anytime you're solicited with an investment opportunity," Hale said. "Be wary of credentials such as 'senior specialist' and 'certified retirement financial advisor.'"
The third threat is high yield and Ponzi investment schemes.
"Investors need to remember that the higher the yield, the higher the risk," Hale said.
Fourth on the list are real estate investments.
"Use caution when investing in house-flipping, distressed properties and new developments," Hale said.
The fifth threat is investment fads.
"Be skeptical of investments that sound new and appealing, such as digital currency, crowdfunding and oil and gas wells," Hale said. "For instance, someone asks you to invest in a diamond mine in Arizona. If you take the time to do some research, you'll discover that Arizona doesn't have any diamond mines."
To report potential illegal activity, call the Investor Protection Hotline at 1-800-721-7996 or go to www.MissouriSafeSavings.com
Also discussed at the meeting was an open house and ribbon cutting to be held July 24 at Hammack Advisory Group, LLC. The ribbon cutting takes place at 12:30 p.m.
Next month's meeting takes place Aug. 4 at Mineral Area College's North College Center. The featured speaker will be Cpl. Juston Wheetley of the Missouri State Highway Patrol. He will discuss threats to businesses related to fraud and drug issues in local communities.