"Since I knew them from my local classic car meetup I thought I could trust them."
Affinity fraud is an investment scam in which fraudsters take advantage of the trust and friendships within groups, religious organizations, and even social clubs to pitch fake opportunities to make money.
Learn how you can easily recognize affinity fraud in your community and take the right steps to check the background of anyone offering you a money-making opportunity, whether it comes from a friend, neighbour or family member.
How to recognize affinity fraud
While devious and sometimes hard to spot or believe, affinity fraud has red flags you can recognize. It’s wise to check into any person or business offering an “opportunity.” Beware if you notice any of the following:
- “Exclusive” and “time-sensitive” opportunities
- Anyone using their personal connections when offering a money-making opportunity
- Referrals from group members
- Low-risk, high-reward promises
- Different names for money-making opportunities including loans, promissory notes, shares, assets, and units
How to check anyone offering a money-making opportunity
When it comes to your money, the best decisions are informed ones. If anyone is offering you a money-making opportunity there are simple ways to help protect yourself from fraud.
- Check if they are registered to sell securities or investments
- Check if they’ve had any disciplinary action (including an interim cease trade order) taken against them in the past through ASC Search or the CSA Disciplined list
- Use our Affinity fraud prevention checklist to review any money-making opportunity
- Sign up for news releases to receive updates on fraudulent activity.
- Consult a knowledgeable professional such as a lawyer, accountant or financial advisor who is not involved in the deal
- Contact the Alberta Securities Commission Public Inquiries office at firstname.lastname@example.org or call toll free 1-877-355-4488 and we can check for you