The explosion of interest in alternative, renewable or waste-energy products has spawned a wave of green-energy scammers.Don’t let your clients fall prey to their schemes. Warn them that shiny green wrappers are often just lures to invest in illegitimate investments or Ponzi deals.
According to FINRA, green-energy investment scammers use faxes, e-mail, text messages, Webinars, infomercials, tweets and blog or message-board posts to ensnare investors. They rely on aggressive, optimistic and potentially false and misleading statements that create unwarranted demand for shares of small, thinly traded companies. Once they amass enough client interest, they sell off their shares, leaving people with a worthless stock.
“Right now, there are a lot of legitimate stories in the news about green-energy initiatives, and con artists want to leverage people’s interest to make a quick buck at investors’ expense,” says John Gannon, FINRA senior vice president for Investor Education.