Released: May 17, 2007

Top 10 take-your-money scams

Source: Michelle Singletary, Washington Post (Free Registration)

If you like keeping lists, there’s one you need to clip and post on your refrigerator door.

It’s the top 10 ways people get involved in bogus or inappropriate investments. The list is compiled by the North American Securities Administrators Association. Some of the scams are old school. They’ve been around a long time and yet they continue to trap investors.

My favorite - and I use that word sarcastically - is the “prime bank scheme.” In this con, promoters get people to think that there are high-return, low-risk financial instruments sold by elite overseas banks. These prime banks do not exist. Using complex terms and promising that their funds are guaranteed, promoters collect money that they then often use to pay for cars, vacations, homes and risky investments that the investors have no idea about.

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