What are the different types of investment fraud?

Investment fraud is a form of white-collar crime that refers to the deceptive practices used to scam people out of their money or property. In California, the state has laws that prohibit a variety of investment frauds. The two main types of investment frauds are Ponzi schemes and boiler room schemes. A Ponzi scheme is a type of pyramid scheme where money from new investors is used to pay off earlier investors, instead of investing it in an actual business as promised. A boiler room scheme is when dishonest stockbrokers use high-pressure tactics to get people to buy stocks that are overvalued, hard to sell, or non-existent. In addition to common schemes, California also has laws that specifically target seniors. Senior Investment Fraud occurs when a scammer targets elderly people, oftentimes luring them into making investments that are not safe. This type of fraud typically involves high-pressure sales tactics, exaggerated promises, and promises of free services if a senior invests with them. Finally, California also has a law called the “Extended Statute of Limitations.” This law allows those who have been a victim of investment fraud to file a lawsuit up to three years after they discover they were victimized. This can be particularly useful if a scammer has made false promises or misrepresentations that were not discovered until long after the fraud occurred. Overall, California has laws in place to help protect people from a variety of investment frauds, including Ponzi schemes, boiler room schemes, senior investment fraud, and more.

What are the different types of investment fraud?

Related FAQs

Related Blog Posts