Investment fraud Quiz

1. What is a Ponzi scheme?

A. An investment fraud that pays returns to existing investors from new investors' funds. B. A scheme where participants receive commissions for recruiting new participants. C. A fraud involving the illegal sale of commodities.

2. Which tactic involves creating a false sense of urgency by claiming limited supply?

A. The 'Phantom Riches' Tactic B. The 'Scarcity' Tactic C. The 'Reciprocity' Tactic

3. What should you do if a salesperson pressures you to make an immediate investment decision?

A. Agree to the investment to avoid missing out. B. Say no and take time to research the opportunity. C. Ask for a discount on the commission.

4. What is a common characteristic of affinity fraud?

A. It involves the illegal sale of commodities. B. It takes advantage of trust based on shared similarities. C. It promises high returns with little or no risk.

5. Which resource can you use to check a broker's credentials?

A. www.brokercheck.finra.org B. www.nasaa.org/contact-your-regulator/ C. www.sec.gov/litigations/sec-action-look-up

Submit Answers