Being able to spot a boiler room scam could save you a lot of time, trouble, money and heartache. This may not be the most common of frauds or scams but it is one that can have a huge impact on your life. This is a fraud which has seen many people lose considerable sums of money so knowing what the fraud usually entails and spotting the tell-tale signs will go a long way to helping you avoid this style of crime.
Is the salesperson becoming aggressive, abusive or relentless?
While you may expect a sales person to be pushy to try and make a sale, you’ll find that fraudsters will often over-step the mark when it comes to dealing with someone they are trying to defraud. Many people who have been victims of boiler room fraud have said that the people they were dealing with were aggressive, rude and even insulting. It has been said that some fraudsters have insulted the intelligence of the victims asking them if they really want to bypass such an easy chance to make money.
This may be something that many legitimate businesses think of their customers but it isn’t going to be something that they ever say out loud. Or at least it shouldn’t be. If you are taking a call from someone and they talk to you in such a manner, feel free to end the call or bring the conversation to a close.
Are you being promised an exceptional return with very little risk?
When it comes to investment, the general rule is a big return comes with a big risk. This is why people will inevitably pay attention when someone promises them the chance of making a great return for a small outlay or risk. You may even find the fraudster promises a guaranteed return! There is no way a legitimate company or professional would make this claim and rather than being intrigued by the offer, you should consider this sort of claim to be a big warning sign when it comes to an investment opportunity.
Real and legitimate firms will be at pains to inform you of the risks involved with investment, so don’t fall for anyone telling you that you are guaranteed to make money by buying quickly.
Are you being pushed for an immediate decision?
Again, you’ll find that many legitimate businesses want a quick answer and they may get pushy in the hope of enticing you into saying yes. This is a tactic that is prevalent in some industries and many professionals have been warned and even punished for their conduct. However, when it comes to boiler room frauds, there is a real need for the fraudster to conclude the deal as quickly as possible.
If the person receiving the call manages to get off the phone, they’ll talk to their friends, they’ll carry out some research and they’ll think about what was on offer. All of these actions make it more likely that they’ll turn down the offer, which is clearly something that the fraudster is looking to avoid.
The fraudster knows that if they don’t conclude a deal right away, they’ll not make the sale, and this is why they are extremely pushy at this point. If you feel uncomfortable with what is on offer, say no and end the conversation. If the fraudster is unwilling to end the call in a polite manner, just hang up on them. You may think that hanging up on someone is rude but it is better to be rude and save your money than stay on the line out of politeness and then find you eventually cave in and conclude the deal.
Other tell-tale signs of a boiler room fraud include:
- An inability to provide information about the investment or sales company
- Talk of confidentiality or secret details
- A reason why you can’t receive your product or shares immediately
- Unusual payment or fun collection procedures
These are all signs that something isn’t quite right and if you come across any of these signs or a combination of them, it is best to go no further with the deal. Hopefully you will never have to spot a boiler room scam but knowing the signs that are apparent will give you a great chance of retaining your money and stopping the fraudsters in their tracks.
Andrew Reilly is a freelance writer with a focus on news stories and consumer interest articles. He has been writing professionally for 9 years but has been writing for as long as he can care to remember. When Andrew isn’t sat behind a laptop or researching a story, he will be found watching a gig or a game of football.