Ponzi schemes and investment scams are on the rise. According to a securities fraud attorney, low-interest rates have caused investors to seek out riskier investments. “Retirees that need income can’t get by with 1% on a bank account – they end up in riskier products that pay more income, but are suspectable to fraud,” explained Marc Fitapelli.  Fitapelli is an investment fraud attorney based in New York City.  He believes that low-interest rates combined with fears over inflation are pushing retail investors into ever more exotic products, causing a spike in securities fraud filings.

Investors Flee the Stock Market for Risky Alternatives

You can’t discuss anything these days without mentioning COVID-19. The pandemic has impacted many aspects of our lives, including our finances.  In the days following the initial news of the pandemic, global stock markets crashed only to quickly soar to record highs a year later. These volatile moves scare even the most seasoned investors.

Most investors learn to deal with these fluctuations, but there is a small subset of investors that shun the stock market in favor of complex non-traded securities. These investments can range from private LLCs, business development companies, private equity companies, non-traded REITs (Real Estate Investment Trusts), and even cryptocurrencies.

Investments that are not traded on the stock market are not illegal to sell. The securities are usually sold under exemptions that the…

Read more…