MONTREAL, March 1 /CNW Telbec/ - More than a million Canadians have lost money in an investment fraud, according to recent research from the Canadian Securities Administrators (CSA). The 2009 CSA Investor Index found that Canadians feel confident and believe they are knowledgeable and responsible when it comes to investing, yet they are not taking the next steps to put their knowledge into practice.
March is Fraud Prevention Month and the CSA is urging investors to move beyond simply knowing what they should do about potential investment fraud and take the next step to protect themselves and their financial future.
"We are encouraged to see that the majority of Canadians are knowledgeable about what they should do when it comes to investing and investment fraud," says Jean St-Gelais, Chair of the CSA and President & Chief Executive Officer of the Autorité des marchés financiers (Québec). "Unfortunately, many do not act on this knowledge, or their actions contradict their knowledge of investing and fraud prevention.
"Investors need to be aware that not every investment opportunity is right for them and that some opportunities may not be appropriate for them, or may even be a scam," says St-Gelais.
The CSA urges all Canadians to take these simple next steps to protect themselves from investment fraud:
1. Work with your investment adviser to assess and review your risk
tolerance. According to the CSA Index, fewer than half of Canadians
have worked with their financial adviser to assess their willingness
to take risk. The CSA encourages you to meet with an adviser to
determine your risk tolerance, and to review it at least once a year.
Knowing your risk tolerance will help when deciding if an investment
fits your goals and objectives.
2. Familiarize yourself with common red flags of investment scams.
Investment fraud is a serious concern. Investors should go to the
CSA's website www.securities-administrators.ca to visit the Avoiding
Fraud page. There you can learn to identify the red flags of
investment frauds such as affinity fraud, boiler room scams and more.
3. Research each investment opportunity and do a background check on the
person and company offering an investment. Researching each investment
opportunity is important, but few investors actually take the time to
complete a background check on the person or company offering an
investment. Use the CSA National Registration Search to see if your
investment adviser is registered to provide the services offered, and
the CSA Disciplined Persons List to see if a person has ever been
disciplined by a regulatory body. You can also contact your local
securities regulator for a listing of any potential enforcement action
against a company or individual.
4. Report any suspicion of investment fraud to your local securities
regulator. Almost four in 10 Canadians have been approached with an
investment fraud, most of them multiple times. Although 78 per cent
believe it's important to report even the suspicion of an investment
fraud, only 26 per cent take that step. The CSA reminds investors that
if you know or suspect you have been approached with a fraudulent
investment, your next step should be to call your provincial or
territorial securities regulator to report the incident.
The CSA, the council of securities regulators of Canada's provinces and territories, coordinates and harmonizes regulation for the Canadian capital markets.
For more information:
Sylvain Théberge Wendy Connors-Beckett
Autorité des marchés financiers New Brunswick Securities Commission
Robert Merrick Ainsley Cunningham
Ontario Securities Commission Manitoba Securities Commission
Ken Gracey Natalie MacLellan
British Columbia Securities Nova Scotia Securities Commission
Mark Dickey Barbara Shourounis
Alberta Securities Commission Saskatchewan Financial Services
Linda Peters Doug Connolly
Office of the Attorney General Financial Services Regulation Div.
Prince Edward Island Newfoundland and Labrador
Fred Pretorius Louis Arki
Yukon Securities Office Nunavut Securities Office
SOURCE Autorité des marchés financiers
For further information: For further information: Sylvain Théberge, Autorité des marchés financiers, (514) 940-2176; Wendy Connors-Beckett, New Brunswick Securities Commission, (506) 643-7745; Robert Merrick, Ontario Securities Commission, (416) 593-2315; Ainsley Cunningham, Manitoba Securities Commission, (204) 945-4733; Ken Gracey, British Columbia Securities Commission, (604) 899-6577; Natalie MacLellan, Nova Scotia Securities Commission, (902) 424-8586; Mark Dickey, Alberta Securities Commission, (403) 297-4481; Barbara Shourounis, Saskatchewan Financial Services Commission, (306) 787-5842; Linda Peters, Office of the Attorney General, Prince Edward Island, (902) 368-4552; Doug Connolly, Financial Services Regulation Div., Newfoundland and Labrador, (709) 729-2594; Fred Pretorius, Yukon Securities Office, (867) 667-5225; Louis Arki, Nunavut Securities Office, (867) 975-6587; Donn MacDougall, Securities Office, Northwest Territories, (867) 920-8984