Danae Hanes has a straightforward philosophy for stopping the fraudsters.
"You're the one with the money," she told a group attending an anti-scam briefing at the Better Business Bureau offices in Southfield last week. "You have what they want."
Hanes, the trade practices consultant for the Better Business Bureau Serving Eastern Michigan, said she's often heard a coworker calmly tell consumers who call the BBB to remember their own power when dealing with a potential scam artist.
You're the one with the money. You're the one in control. Or rather, you're the one who should be in control -- and the one who should stay in control.
For most of us, it takes years and years to work and save and one day see the Big Money. But it only takes one free lunch with a bad actor broker -- or a few too many phone pitches for the next hot investment deal -- for a con artist to steal a huge chunk of that money away from you.
Educational training programs to avoid scams are offered at various times and locations throughout Michigan and the country. The FINRA Investor Education Foundation has a website called www.SaveAndInvest.org that includes an online Fraud Center, which is a one-stop location for investors to check the background of investment professionals and understand the psychological persuasion tactics used by con artists in investment scams.
Consumers using the SaveAndInvest.org site also can request a free DVD of the FINRA Foundation's documentary "Tricks of the Trade: Outsmarting Investment Fraud."
Consumers also can find a retirement calculator, as well as investor alerts, at SaveAndInvest.org.
I had a chance to attend the morning workshop given by the Michigan BBB, which received a grant from FINRA for offering the investment scam seminars. The conversation focused on how con artists can get you to switch off your intellectual mind and focus on your emotions.
Maybe you'd feel better if you could rebuild your wealth after bad losses from the financial crisis.
Maybe you'd be happier if you could afford to pay for your children's college education.
Maybe you'd feel good if you knew that others in your church were investing money in the same investment deal.
And maybe if the con artist plays to one or all of those emotions, you'll let your guard down and trust that guy or gal with your hard-earned money.
As part of the presentation, Hanes showed old "Candid Camera" TV show segments about how people can be tricked into thinking that yes, for one day someone could decide to close all the roads to an entire state. Another video showed how an experienced financial adviser could lose $40,000 of his own money on an oil and gas scam.
At the Southfield office, one man in the small group talked about receiving calls from someone who wanted him to spend $9,000 to get an article published about his small company in a major national magazine. He was skeptical and said that high price made it seem like a scam.
Art Peschke, who runs Works of Art! General Handyman Services in Royal Oak, talked about the time he was talked into spending $700 to advertise in some brochure that supposedly would be sent to members of country clubs. It turned out the publication was far smaller and only showed up at some offices at golf courses.
He decided to e-mail the guy who sold him the ads and he e-mailed that letter 50 times.
"By Wednesday, the guy had had enough of me, and he sent my money back," Peschke told the group.
Lakita Phillips-Brown, who works for BenjiGates Estates in Lathrup Village, said she regularly gets calls for so called "free gift cards." Somehow she's always won a prize for a free gift card at Walmart or somewhere else. Of course, that prize comes with a fee -- and she knows it's a scam.
Sound too good to be true?
Some things can look too good to be true, too.
Hanes also warned about that "halo effect" -- where someone dresses well, leases a luxury car, and takes you out to a nice lunch all to make you feel like you're meeting with a successful money manager.
But she warned that credibility can be faked.
Do you really know who would be handling your money? Do you really know the risks of that investment? Should you really feel obligated to turn over all that retirement money to invest in something you don't really understand simply because someone spent twenty bucks on a lunch for you?
Contact Susan Tompor: 313-222-8876 or email@example.com
To check out a business or charity in eastern Michigan, go to http://detroit.bbb.org/