Don't Trust - Verify: Protecting Your Investments in an Era of Rising Fraud
The Shocking Reality of Investment Fraud: A $5.7 Billion Wake-Up Call
In the world of private lending, trust is earned, not assumed. The latest FTC report paints a grim picture that should make us all sit up and take notice:
A staggering $12.5 billion was lost to fraud in 2024 alone - a 25% increase from 2023. 1
Investment scams accounted for $5.7 billion of that total - a shocking 24% jump from the previous year. 1
These aren't just numbers. They represent thousands of victims - from seasoned investors to first-time lenders - caught in a web of deception. It's a growing epidemic that feeds on trust, ambition, and often, desperation.
The Secret Weapon of Scammers: Manufactured Urgency
Desperation is the secret weapon in the investment space. Think about it. How much advertising have you seen for that revolutionary software, life-changing mentorship, or exclusive community that promises financial freedom? These marketing tactics aren't just selling a product - they're manufacturing urgency.They're telling you that you NEED to act NOW, or you'll miss out on the opportunity of a lifetime. It's a psychological game, and it's incredibly effective. Studies show that when we're financially desperate, our judgment becomes clouded, making us more susceptible to overlooking red flags. 2
Due Diligence Elements
Just as you (hopefully) wouldn’t drive without your glasses if you need them, don’t invest without proper verification. Here’s our proven due diligence approach to protecting yourself:
Document Everything: Keep a record of all communications, agreements, and transactions.
Verify Credentials: Check the identities and qualifications of everyone involved.
Cross-Reference Claims: Look for inconsistencies in the information provided.
Seek Independent Opinions: Consult with trusted advisors or professionals.
Trust Your Instincts, But Verify Your Facts: If something feels off, investigate further.
Verification isn’t about distrust and negativity—it’s about wisdom. It’s about valuing your hard-earned money enough to ensure it’s going to the right place.
Fault vs Responsibility
Being targeted by fraud is not your fault. But protecting yourself? That’s your responsibility. You have the power to be both kind and careful, supportive and thorough. By embracing due diligence as a form of basic business practices, you’re not just protecting your finances—you’re safeguarding your peace of mind.
So, the next time someone pitches you an “opportunity of a lifetime,” take a step back. Ask the hard questions. Verify the details. Because in the world of private lending, trust is earned, not assumed.
Need help setting up your custom due diligence processes, want to invest with a vetted borrower with an Investor Passport, or need something else? Reach out.
