The calling card for this fraud is an exciting, low-risk, easy money investment opportunity in an exotic sounding business. Below are certain businesses which attract more than their fair share of financial fraud:
- Oil and Gas: Beware of “working interests” in “proven” oil and gas wells. Frauds include fake drilling equipment set on worthless land or vacant wells that haven’t produced in years.
- Equipment Leasing: Pay close attention when a company sells you a piece of equipment which it agrees to lease back for a fee. Be certain the company is legitimate and the contract fee structures make business sense. Pay phones, ATM machines, internet kiosks, or any other consumer technologies are favorites among leasing fraud.
- Franchise Offerings: “Get in on the ground floor of this can’t-miss opportunity.” Yeah, right! Legitimate franchises are everywhere, causing people to abandon their usually cautious nature when confronted with a bogus franchise. Over-inflated store results and phony testimonials are used to extract upfront franchise fees for misrepresented services, supplies, and goods.
- New Technologies: Watch out for people seeking funding for a new patent or invention sure to make you rich. Similarly, beware of investment frauds designed to imitate legitimate technologies such as FCC licenses for cell phones, wireless cable, or interactive video.
$Alco(00328)$ $LUOYANG GLASS(01108)$ $RENCO HOLDINGS(02323)$
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