Have you ever been invited to attend a free investment seminar, promising high returns with - what you’re told - is little risk? Have the fees to attend the following seminars been suspiciously high? These are just two warning signs that the investment seminar you are attending might be promoting an investment scam.

Investment seminars are often advertised with motivational speakers, life coaches and investment “experts” .  These seminars are often run by self-proclaimed self-made-millionaires who intend to give you exclusive advice on how to invest, and make massive returns. They offer  “foolproof” investment advice,  the same advice and strategy that made them rich.

In reality, these investments are anything but low-risk. They often convince unaware consumers to follow high-risk investment strategies, such as borrowing large sums of money to buy into their exclusive property development,  or investments that involve lending money on a no security basis or other risky terms.

Often the promoters of investment seminars initially profit by charging high attendance fees, and by selling overpriced merchandise and reports.  They will then attempt to sell you high-risk investments, without giving you the opportunity to seek independent advice. 

The investments which they offer attendees are frequently overvalued, and investors often end up paying extra fees and commissions which they were not clearly informed about.  The promoters use high-pressure sales tactics, and misleading claims, such as “guaranteed rent”, or “exclusive discounts” for buying off the plan,  to pressure you to invest. The promoters often convince the attendees that the offer has a sensitive time-frame, and if you don’t act urgently, you will miss out on the opportunity.

Consumers should be extra cautious if the organisation hosting the events offers debt to cover event attendance, as well as debt to cover the investments offered at these seminars.  If you invest in the offers at this type of investment seminar, you should be aware that there is a high chance you may lose money due to the high-risk nature of the investment offerings.  If you intend to invest, ensure you consult an Independent Financial Advisor, to establish that you are making the most appropriate choice for your circumstances.

Visit ASIC's MoneySmart for more information about investment seminar scams.