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How to know if investor is scamming?
Old 05-10-2021, 06:29 AM   #1
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How to know if investor is scamming?

I'm still looking for a new investor and have a meeting with a potential new one, but the main thing is how would I prove the current person has been unethical and or is there any recourse?

Thank you.
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Old 05-10-2021, 06:35 AM   #2
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Are you referring to an investor (who is going to put money into a project or development of yours) or an investment advisor (who is going to assist you in investing your money)?
If it is the latter, then you want a fee-only investment advisor who is a fiduciary. This person does not receive commissions for any investment product and as a fiduciary, your needs are number 1. A Google search should provide some reviews on advisors. If you are switching advisors, you dont need a reason to change.
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Old 05-10-2021, 07:33 AM   #3
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They are an advisor but I never see profits over 6 years. I stopped adding due to trust issues and even money sitting there really no returns. Argued recently and have him saying stuff in emails that would say it should be growing but it's not. Claims 8%. I see nothing.
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Old 05-10-2021, 07:46 AM   #4
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If this is an established firm, you should be able to choose another such as Fidelity, Schwab or Vanguard and tell THEM to transfer the money into a new account. That way you could avoid this person entirely.

What types of investments are in the account?
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Old 05-10-2021, 07:47 AM   #5
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We are going to need more info here. This sounds like Madoff but I thought he died in prison.
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Old 05-10-2021, 09:02 AM   #6
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Sounds like someone who will be featured on "American Greed" on CNBC...
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Old 05-10-2021, 09:06 AM   #7
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Originally Posted by cloud9nd View Post
They are an advisor but I never see profits over 6 years. I stopped adding due to trust issues and even money sitting there really no returns. Argued recently and have him saying stuff in emails that would say it should be growing but it's not. Claims 8%. I see nothing.
More info is needed, but if this is true, you need to get your money out of there ASAP. The past 6 years (with the exception of March 2020) has been a tremendous bull market. If you have money in equities, you should have seen substantial gains.


If he is telling you your account is growing at 8% but the balance hasn't changed significantly, something is seriously wrong and you need to get out of there.
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Old 05-10-2021, 09:07 AM   #8
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You haven’t provided nearly enough information for us to provide any meaningful suggestions.
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Old 05-10-2021, 09:52 AM   #9
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do you have statements? do you have online visibility into your account? If so, find a local fiduciary at an established firm, take your paperwork and ask for their counsel. Proceed from there.

If you aren't making money in the market the past 7 or 8 years, you aren't in the market, or someone is skimming.

ETA: You got a lot of good advice in this similar thread, from January. What actions have you taken since then?

https://www.early-retirement.org/for...ml#post2552290
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Old 05-10-2021, 10:40 AM   #10
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They are an advisor but I never see profits over 6 years. I stopped adding due to trust issues and even money sitting there really no returns. Argued recently and have him saying stuff in emails that would say it should be growing but it's not. Claims 8%. I see nothing.
You should have seen losses with the markets down in spring of 2020, and big gains since then. You should know what you are invested in. You need to get out now. I have used financial advisors as I would have made many mistakes from lack of knowledge, but my portfolio is at Schwab and I know exactly what is going on.

I think you need to pull your money out of there-5 years ago.
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Old 05-10-2021, 10:41 AM   #11
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Not a fan of having others tell me what to do with my money.

Just sayin' .
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Old 05-11-2021, 07:05 AM   #12
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Thanks all.

Hundreds of thousands in for years in that account and stagnant. I would expect some compound interest. I am wondering if they are skimming off all the gains. I have made no money in that account. Private firm that uses larger platform.

New person told me they would have doubled my balance these last 5 years.

Sick to my stomach.
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Old 05-11-2021, 07:37 AM   #13
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New person told me they would have doubled my balance these last 5 years.

Sick to my stomach.
Maybe, maybe not. All depends on your directives to them, and the appetite for risk you conveyed. If you said you wanted to have near-zero risk, it would be in bonds and low-growth assets. If you said medium-higher appetite, sure, over 7-8 years it should have doubled. What did you have them invest in on your behalf?
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Old 05-11-2021, 08:10 AM   #14
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I asked for higher they say no. Medium only.
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Old 05-11-2021, 08:13 AM   #15
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Do you even know what you were invested in?

Boggles my mind how much people with money to invest don't know.

Makes me think if I were a criminal, I could be friggen rich.
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Old 05-11-2021, 08:16 AM   #16
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Originally Posted by easysurfer View Post
Not a fan of having others tell me what to do with my money.

Just sayin' .
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Old 05-11-2021, 08:19 AM   #17
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I asked for higher they say no. Medium only.
Then leave them now. Today. Go back through your other thread, and if you go to Fidelity, Vanguard, they will do it all for you. It might even be worth paying for advisory services for a year to get you started since you seem to be a bit paralyzed.
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Old 05-11-2021, 08:35 AM   #18
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Do you even know what you were invested in?

Boggles my mind how much people with money to invest don't know.

Makes me think if I were a criminal, I could be friggen rich.
Making money and keeping money and growing money are very different skills. Some people only learned, or figured out, how to make it.

In this case, I doubt that anything nefarious is going on. Seems more likely that there is just a big disconnect in expectations and goals between the OP and the investment advisor.
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Old 05-11-2021, 09:07 AM   #19
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Could it be possible that you are mis-reading the statements? It is very unlikely that your account value has stayed constant over the years. Could it be you are in some sort of individual bonds or structured investments and they have not come due yet?

I was talked into a structured CD (actually a select few stocks) by my banker in 2008. No way could the next 5 years not make money with the market being so low, or so I thought. Well..... it lost money in spite of the market. One of the selected stocks lost a lot of value. At the end of the agreement, because it was a structured CD, the bank did manage to make good on my initial investment/deposit.
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Old 05-11-2021, 06:44 PM   #20
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Has OP indicated what type of investment this is? I think I saw it described as “private”(could be anything or nothing). Could be OP does not know. Lots of red flags here. I see a poster referring to market gains but can’t tell if that is the right comparison.

OP. You will get great feedback here but you need to share some details. Have you ever taken any funds out of this “investment”? Was it easy to do so? In any event If you are sick to your stomach it’s time to move on to a major investment firm. Vanguard, Fidelity, Schwab and similar are very popular with members of this forum. We gripe about trivial things but the investments performance is very transparent.
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