Look for any one of these red flags when investing. If you spot a red flag, stop and don’t invest! The investment may be a scam or you could be dealing with a fraudster. Immediately, report suspicious activity to your local securities regulator.

To report an individual or a firm acting fraudulently, contact your local securities regulator:

Most common red flags

Click on a red flag to learn more :

Unregistered Individuals and Firms
Use the National Registration Search (NRS) to check registration. If you suspect an individual or firm selling an investment or offering advice is not registered, stop dealing with them immediately. If someone who has approached you to invest tells you they are registered, check NRS and with the registered firm they say they work. Always use an individual’s business contact information provided by a registered firm.  
Often seen in: Ponzi scheme, pig butchering, crypto scam 

Unrealistic Returns
Returns that are “too good to be true” probably are, and all investments have some level of risk. Fraudsters often try to hook people by guaranteeing extremely high returns in a short period of time with little or no risk.  
Often seen in: Forex scam, crypto scams, pump and dump, exempt securities scams 

Pressure to Make a Quick Decision
Individuals who promote fraudulent schemes don’t want to give you any time to figure out their game. They may also pressure you to invest a little at first. Once you invest, they will then come back looking for a larger amount. 
Often seen in: Email spam, crypto scams, boiler rooms 

Financial Advice from Strangers
Fraudsters may offer to help you with your investment account or ask for remote access to your computer or mobile device. Giving out your account information to people or allowing them to access your computer or mobile device is extremely risky. It could result in fraud and/or identity theft.  
Often seen in: Ponzi scheme, crypto scams, email spam 

Exclusive Investment Offers
Be wary of investments that are promoted as exclusive offers only you and select people, like wealthy insiders, have access to. Fraudsters like to name drop, or say they have access to famous or rich people when promoting an investment.  
Often seen in: Ponzi scheme, affinity fraud, crypto scams, investment seminar scam 

“Insider” Information
If an investment advisor or individual says they are giving you “confidential” investment advice, they may actually be deceiving you or their employer. Both put you at risk. It is illegal to knowingly trade on inside information.  
Often seen in: Crypto scams, boiler rooms, exempt securities scams 

Offshore Firms and Advisors
If a firm or individual from outside of Canada is trying to open an account for you, wants to give you trading or investment advice, or is offering you an investment, be extremely wary. Brokerage firms need to register with your province or territory as dealers or advisors in order to open trading accounts or recommend investments to you.  
Often seen in: crypto scams, forex scams, offshore investment scams 

Anti-Establishment
Any individual who encourages you to subvert the government or avoid financial institutions is most likely trying to keep their illegal activities from being tracked. 
Often seen in: Boiler rooms, crypto scams 

Cutting out the Paper Trail
Without documents for investment purchases, statements, or a prospectus (a formal document that explains the details of an investment and the risks involved), a fraudster can easily take your money without being detected. 
Often seen in: pig butchering 

Avoiding the Question
If the person selling you the investment doesn’t answer your questions or they use diversionary tactics, they’re probably trying to keep you from seeing the truth. A legitimate investment advisor has nothing to hide. 
Often seen in: pig butchering, affinity fraud  

Unsolicited Contact with Casual Familiarity
Be cautious of unexpected calls, emails, or messages from individuals who seem overly friendly or familiar. Fraudsters will try to establish false familiarity to quickly break the ice and build trust with victims. 
Often seen in: Affinity fraud, romance scams, pig butchering  

Frequent Travel Claim
Beware of individuals who claim they are frequently traveling and cannot meet in person. This is a common excuse used by fraudsters to avoid face-to-face interactions. By mentioning overseas business trips, the character creates an image of success and being busy.
Often seen in: Crypto scams, boiler rooms

Risk Free, High Return
Be skeptical of promises of high returns with little or no risk. Legitimate investments come with various levels of risk, and no one can guarantee high returns without any risk. 
Often seen in: forex scam, crypto scams, pump and dump 

Addressing Scam Concerns Directly
The line “Are you worried this is a scam?” is a common scammer tactic to preemptively counter skepticism by overemphasizing their credentials and reliability.
Often seen in: Affinity scam, pig butchering, romance scams

Offer to Provide Personalized Guidance
This is a manipulation tactic often used by fraudsters to foster trust. While it is normal to receive personalized guidance when dealing with a registered financial advisor, it is not normal when approached by a stranger. 
Often seen in: Investment seminar scam, pig butchering, affinity scam 

Fake website / Social Profiles
Fraudsters will often try to recreate official websites or social media profiles to make you think you are dealing with a legitimate organization. Look out for typos in the content and verify with official sources.  
Often seen in: Crypto scams, binary options scams 

Fake Registration Proof
Fake documents are used to deceive investors into believing that the scammer is a trustworthy and authorized investment professional, when in reality, they are not. 
Often seen in: Pig butchering, investment seminar scam 

A Timely Opportunity
Fraudsters will use this psychological tactic, the fear of missing out (FOMO), to make you believe you are missing a great opportunity. They create a sense of urgency and excitement, making it seem like everyone else is getting rich quickly, and if you don’t act fast, you’ll miss out. 
Often seen in: Pig butchering, crypto scam, Ponzi scheme 

(Fake) Celebrity Endorsements
Be wary of investment opportunities that claim to have endorsements from celebrities. fraudsters often use fake endorsements to lend credibility to their schemes. Always verify the authenticity of such endorsements by checking official sources.  
Often seen in: Crypto scam, affinity scam  

Remote Access and Screen-Sharing Requests
Fraudsters may request remote access to your computer to guide you in installing investment software. In reality, they are trying to steal personal information or install malicious software. Never grant remote access or share your screen with someone you do not know or trust. 
Often seen in: Pig butchering, crypto scam  

Investment Opportunity Out of Nowhere
After building a fake relationship with you over a period of time, the fraudster will present you with an investment opportunity that they ‘stumbled’ upon. They will tell you that they already made a lot of money or that a friend already made money.  
Often seen in: Romance scams, pig butchering, affinity fraud 

Opportunity Tied to Trends or Recent Event
Be cautious of investment opportunities that are linked to current trends or recent events. Fraudsters often exploit popular topics to make their schemes seem more legitimate. 
Often seen in: Crypto scams, boiler rooms 

Person Asking for More Money Over Time
Be wary of individuals who continually ask for more money after your initial investment. This is a common tactic used by fraudsters to extract as much money as possible.  
Often seen in: Pig butchering, romance scams 

Special Fees or Taxes to Withdraw
Be skeptical of any investment that requires you to pay special fees or taxes to withdraw your money or gains. Legitimate investments do not have hidden fees or unexpected charges.
Often seen in: Crypto scams, offshore investment scam