Financial fraud can present itself in many different ways. This article will focus on protecting yourself when dealing with a financial advisor. Before deciding to work with a financial advisor, it’s important to ensure that they are licenced to practice by the AMF (Autorité des Marchés Financiers). You can easily check yourself by searching their name on the AMF website here: http://www.lautorite.qc.ca/
Once you’ve decided to work with someone, do not be ashamed to ask as many questions as you’d like until you gain a strong understanding of the topic. Try and refrain from signing up to anything on the first appointment.
That being said, keep the following red flags in mind because they may indicate suspicious behaviour:
- You're being asked to write a cheque to the advisor's name or to their company name instead of writing it to a recognized financial institution.
- You’ve been told that this particular investment has been recommended or approved by the AMF or another government regulator. The AMF or others don’t endorse investment products.
- You’ve been promised a guaranteed rate of return which is unusually high.
- You’re being told that there is a deadline to invest into a particular product, that it’s a ‘’now or never’’ type of situation.
- Your advisor becomes impatient or avoids answering important questions you have regarding the product you’re interested in.
If you’re suspicious and something does not feel right, call the AMF and discuss your concerns with them. Their mandate is to protect the public; you can reach them at 514-395-0337.
If you have questions, or would like to share an experience you’ve had, please include them in the comments below.
Daniel Enayatzadeh is a Financial Security Advisor specializing in investment and insurance planning. He can be reached at 514-996-9400 or at firstname.lastname@example.org