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Home > Blog > BBB, FINRA Foundation Launch Website to Help Prevent Investment Scams

BBB, FINRA Foundation Launch Website to Help Prevent Investment Scams

Every year, consumers lose millions of dollars in bogus investment scams and Ponzi schemes. Now, a new Website aims to educate investors on how to avoid investment fraud, risky investments and unlicensed brokers.

The Website – BBB Smart Investing – was created through a partnership between the Better Business Bureau and the FINRA Investor Education Foundation. The site provides a wealth of tools, information and resources designed to help investors better protect and manage their money.

Consumer financial fraud is a serious problem in United States. According to the Federal Trade Commission and the Canadian Anti-Fraud Centre, consumers lost more than $1.5 billion to varioius types of scams in 2011. FINRA Foundation research shows that many investors are overconfident regarding their knowledge of financial management, particularly Baby Boomers who are often the target of investment scams.

One telephone survey found that 92% of individuals felt “somewhat” or “very confident” about managing their finances, with almost 80% describing themselves as “somewhat” or “very” knowledgeable about investing. But only 44% got a passing grade on a basic financial literacy knowledge test.

BBB Smart Investing hopes to help change that statistic, according to Carrie Hurt, President and CEO of the Council of Better Business Bureaus.

“This is a great partnership,” says Hurt. “Even though BBB has always investigated investment scams, this gives us a whole new portfolio of prevention tools to offer to consumers. The FINRA Foundation’s basic ‘Ask & Check’ message is exactly what consumers need to hear before they make investment decisions. We think this program will go a long way toward preventing investment scams that have become so much more prevalent in recent years as people more actively manage their own retirement funds.”

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