Many Virginians are familiar with unsolicited invitations to attend seminars that
promise a free meal at an upscale restaurant along with investment and money management strategies.
The seminars, which frequently target seniors, often claim to teach attendees how to secure their retirement, earn excellent returns on investments, eliminate market risk and reduce or avoid taxes.
A recent survey sponsored by the National Association of Insurance Commissioners and the research firm Caravan found that one in five Americans has attended such an event. Of those, 41 percent reported purchasing a product or service. Among 18- to 34-year-olds, the number jumps to 58 percent.
“Insurance and other financial products are important when planning for your financial future,” said Virginia Insurance Commissioner Scott A. White. However, he encourages consumers to evaluate any financial product thoroughly and beware of one-size-fits-all marketing programs. “Make sure you understand the products being offered and you are comfortable that they suit your particular needs and goals.”
The State Corporation Commission (SCC) encourages Virginians to do their homework before and after attending an investment seminar. Ronald W. Thomas, the SCC’s Director of Securities & Retail Franchising, offers the following tips:
• Prepare for a high-pressure sales pitch. Most people who attend a free meal seminar feel
pressured to purchase something or to provide personal information. A free meal does not
commit you to anything. Don’t be pressured into making on-the-spot decisions about any
investment opportunity or opening an account. Don’t commit to purchasing a product if you
don’t understand the product, cannot get details in writing, the presenter comes on too strong, or you want to shop around.
• Make sure the products offered are right for you. Know yourself and how much risk you are comfortable taking. Ask questions and take the time to thoroughly assess any opportunities presented to make sure they fit your needs. What’s right for one person may not be suitable for someone else.
• Personal information is valuable. The information you provide to register for a seminar may be sold to other people intent on selling you other products or investments. Make sure you understand how the sponsor of the event may use your information and whether you may receive follow-up contacts from the seminar sponsor, presenters or others.
• Ask if the presenter and products offered during a seminar are licensed or registered.
Investors can find out more about presenters and products by asking the sponsor, conducting research using online resources, or contacting the SCC’s Securities Division or the SCC’s Bureau of Insurance.
• If it sounds too good to be true, it probably is. All investments carry some degree of risk and many investments cannot guarantee a particular return. Investigate and verify any financial product and the potential risks and rewards.
In Virginia, insurance companies and agents are required to follow particular guidelines and make specific disclosures when presenting certain products, such as annuities, to consumers. The same holds true for securities broker-dealers and investment advisors and their agents and representatives whenmatching customers with investment products.
For questions or complaints regarding insurance companies, agents or products, Virginians can contact the SCC’s Bureau of Insurance in Richmond at 804-371-9741 or toll-free (nationwide) at 1-877- 310-6560 or visit www.scc.virginia.gov/boi. For questions about securities-related products and the people offering them, contact the SCC’s Division of Securities and Retail Franchising in Richmond at 804-371-9051 or toll-free (in Virginia) at 1-800-552-7945 or visit www.scc.virginia.gov/srf.