Kakala o Tonga.com

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Have you ever heard the phrase: “If its too good to be true, it isn’t”. Those words are as true today as they were when they were first said.

One of the things that people have to be wary of is our weakness to look for the ‘quick buck’ and the ‘overnight riches’. When people have their eyes on investment, it is very important that people do their homework on the investment and on the people doing the investment on their behalf. All too often, our Tongan people and many others are taken advantage of by so called “investment advisers” through slick sales presentations and sales speak. Some fall for the ’sizzle’ of the sale before scrutinising and researching the details of the fine print. If there was one important piece of advice for people when making investments is to always take the investment material/information away with you for you to study. If these investment companies make up excuses that they have ‘run out brochures’ or ‘we don’t give out our materials, but can we book an appointment?’ , it is highly likely that the presentation is a SCAM. There is very little reason for companies not too have any information for you to take home and digest. Ask yourself this, ‘if this company says they have millions of dollars in finance then why have they run out of brochures?’ Surely a million dollar company would have enough information for everyone?

Below is an extraction from the NZ Herald:

The Securities Commission is warning people about common investment scams. It warns that an “investment offer” is likely to be a scam if you are:

* Promised very high returns with little risk. These promises are too good to be true.

* Given little information in writing. Investments must have documents that explain the investment.

* Told the offer is know only to a select few, or is a “once in a lifetime” opportunity. These ploys encourage you to pay money.

* Not told who is behind the offer or given a physical address. Legitimate investments must give contact names and full addresses.

* Promised access to “prime banks” or “secret” overseas agencies that supposedly offer very high returns. These agencies don’t exist.

* Asked to keep the offer secret. This is to stop the authorities hearing about it.

If you are offered such investments, the commission advises asking questions:

* What sort of investment is this? “You’d be surprised how many people don’t understand what they are investing in,” says the Securities Commission* What are my risks? Be suspicious if you’re told the investment is risk-free.

* How do I cash in my investment?

* Who will my money be paid to?

* What is the name and address of the entity you want me to invest in? The names of people offering legitimate investments are always available.

* Who do I contact for more information or if something goes wrong?

* Is the money going overseas and, if so, what is the name and address of the New Zealand agent? Get a physical address.

* Seek independent advice from a lawyer, accountant, or financial adviser who has no connection with the investment offer.

Filed under: Consumer Watch