Warning on Fraud and Scams
We value your protection. ​
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Anyone can be the target of financial fraud and scams. Your best defense is to stay informed, alert and secure. Below you will find tips on how to avoid being scammed and information on common financial services scams.
Protect Yourself - Be Scam Aware
Be Skeptical
In the virtual world, fraudsters can easily disguise themselves. Be skeptical of the identities of anyone you meet online, particularly if they claim to be an investment advisor or celebrity. Be especially vigilant when offered unsolicited investment advice by online "friends."
Do Your Homework
Much of the advice that is recommended by the operators of these scams were
Be Wary of Investments That Sound Too Good To Be True
If an investment sounds too good to be true, it often is. Remember that there is no such thing as a low-risk investment with high guaranteed returns - a claim frequently made by fraudsters to entice unwary investors by manipulating their fear of missing an opportunity.
Examples of Common Scams
The following are just some examples of common financial frauds. However, it is important to remember that perpetrators of fraud are constantly designing new ways to target their next victims. For this reason, you should remain vigilant and consider the possibility of fraud, even if the circumstances do not exactly fit one of the below examples. You should also keep an eye out for notices or warnings issued by your local regulator, exchanges or other market participants regarding patterns of fraudulent activity.
Clone Firm Scams
Scammers may pretend to be from a legitimate firm to get you to transfer money to their account. In some cases, scammers may pretend to represent or be part of a reputable financial services company, including Meritum Advisors, Interactive Brokers, Altruist, Intuit, or any of the other third-party service providers that we utilize to service and advise our clients. The purpose of a Clone Firm Scam is to get you to transfer your money to an account that appears legitimate but which in fact belongs to the fraudsters.
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These scams may involve the fraudster using a reputable firm's logo or letterhead, adopting names that resemble those of the reputable firm, or even using names and addresses of persons who are associated with the real firm(s).
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Be wary of cold calls or emails you receive requesting money from you. Check to make sure all emails use the firm's real domain (e.g. meritumadvisors, interactivebrokers.com, altruist.com, intuit.com). Be especially careful of any unprompted interactions through social media platforms - Meritum Advisors, or any of its third-party service providers may promote general products or services on social media but will never interact with you through these channels in relation to your account(s). If you are unsure whether a communication is legitimate, please contact us immediately.
Watch Out For Red Flag!
Here are some red flags you should watch out for, if contacted by someone claiming to work for Meritum Advisors, or any of the other third-party service providers that we utilize to service our clients:
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Our advisors do not cold-call consumers for unsolicited advice, products, strategies, and/or other services,
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Our advisors do not charge you for assistance providing technical assistance in completing account applications and do not advise you on what information to enter in an account application.
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Our advisors do not request sensitive information, such as account numbers, banking information, personal information, or other sensitive information, via email or other written formats.
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Our advisors, firms, or third-party service providers do not charge you a fee to withdraw your funds.
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Our advisors, firms, or third-party service providers do not ask for remote access to your computer or mobile device.
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Our advisors, firms, or third-party service providers do not ask you to share login details, particularly when this is done by creating a sense of urgency (e.g. "we have detected a fraud/theft attempt on your account and need your login details to stop/deflect it").
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If you are unsure if you have received a communication from one of our advisors or another staff member of our firm, please call us directly or email our Chief Compliance Officer at Vasili@meritumwealth.com.
Check and Double Check!
If you are contacted by someone claiming to work for a regulated firm, remember:
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Verify the details of the firm or individual on regulatory websites. For firms or individuals in the United States, this includes:
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Financial Industry Regulatory Authority (FINRA): https://www.finra.org
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Securities Exchange Commission (SEC): https://sec.gov
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National Futures Association (NFA): https://www.nfa.futures.org
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Commodity Futures Trading Commission (CFTC): https://www.cftc.gov
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Internal Revenue Service (IRS): https://www.irs.gov​
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Beware that scammers may point you to the real firm's genuine website but use different details for their communications with you. Acquire contact information directly from the member's firm's website or the regulator's website. Use an internet search to find the member firms official website rather than relying on a web address provided to you.
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If you are not a client of Meritum Advisors, or do you have any account(s) with any of our third-party service providers, please report any concerns of fraud to the police in your local jurisdiction.
Retirement Account Scams
Retirement account disbursements are commonly accessible once a minimum age has been reached. Early access is normally possible but often leads to early withdrawal penalties. With this scam, fraudsters promise "penalty-free" early access to retirement benefits through alleged tax loopholes and use complex schemes to erode retirement accounts through commissions, investments, etc.​
Holy Grail Scams
Scammers are well aware of the attraction of a "holy grail" trading system or financial product or strategy that will generate profits 24/7/265 with no risk or losses. One common tactic is to market a secret formula or strategy that promises extraordinary returns. Be aware of extravagant claims and testimonials that seem too good to be true. They usually are!
Affinity Fraud
Scammers who carry out affinity scams frequently are (or pretend to be) members of the group they are trying to defraud. Scammers exploit their victim's age, religious, ethnic, sexual, or professional identity to gain their confidence knowing that it's human nature to trust people who are like you. Affinity fraud almost always involves either a fake investment or an investment where the fraudster lies about important details (such as the risk of loss, the investment's track record, or the scheme promoter's background).
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Many affinity frauds are Ponzi or pyramid schemes, in which money given to the promoter by new investors is paid to earlier investors to create the illusion that the so-called investment is successful. Eventually, when the supply of investor money dries up and current investors demand to be paid, the scheme collapses and investors discover that most or all of their money is gone.
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To protect yourself against affinity fraud, always carry out your own research and due diligence before entering into arrangements to accept investment advice or services. In particular, you should always verify the credentials of the person or company offering the services and confirm whether they are regulated to carry out that activity be checking the register of your local regulator.
Pump-and-Dump Schemes
In these schemes, scammers invest in a stock and then spread false or misleading information to create a buying frenzy that will artificially "pump" up the price of a stock. They then "dump" their own shares at the inflated price and stop hyping the stock, leading other investors to lose money as the stock price falls. Those recommendations may be presented as "hot" information, from people in the 'the know' and made available to you due to some privileged or special status.​
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Scammers often take full advantage of new technologies to spread false or misleading information about a company's stock price. For example, trading "recommendations" are frequently spread through messaging apps, social media platforms, and/or web blogs.
Trash-and-Cash Schems
These are the opposite of pump-and-dump schemes. In Trash-and-Cash schemes, scammers circulate false information to encourage people to believe that relatively illiquid security is likely to plunge in value and should be sold. When those who see this information sell the security, the price plummets, and the scammers then swoop in to buy it up at a low price. ​​