If you’re looking to invest while in Oman, make sure that you know exactly where your money is going.
27 June 2017| Last updated on 2 July 2017
While Oman is an extremely safe country, there are still some instances where expats have fallen prey to money scams. In order to protect yourself, it’s always wise to be familiar with the common types of scams you might encounter.
As a new investor, you have to be extra careful where you put your hard-earned cash. Here are ones to watch out for…
1. Ponzi schemes
Ponzi schemes are known all around the world and many have suffered from it. Essentially, it’s when an investment is taken from new investors and it’s then used to pay back the “returns” to older investors. This means that your money is never actually invested in anything.
2. Pyramid schemes
This type of scheme promises really high returns over a short period of time. It’s named after a pyramid structure as it involves each investor bringing in new investors to be able to gain any profit.
3. Forex scams
Foreign currency trading is a rather complicated scam to pull off. These scams are usually promoted as forex trading and they’re usually managed from an offshore spot. If you are ever asked to wire money to an offshore bank account, be very wary of it.
4. Pump and dump
This is a scheme that involves stock market fraud. Usually it’ll involve a few investors (insiders) who buy a stock and heavily promote and recommend it to many others. As a result, the stock price inflates and once it peaks, the insiders sell their stake for a huge amount of money, leaving everyone else with practically worthless shares.
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5. Internet investment
These scams are usually easy to spot, but some people fall for them nonetheless. They usually come in the form of internet ads that promise outrageous returns or show how a regular person doubled their money in no time.
There are many signs of investment scams that will make it easier to spot them. Conmen will try to target investors who want to make quick cash, so don’t get reeled into the getting rich quickly pitch. Most of the time, if it sounds too good to be true, it probably is.
It’s also crucial to research the company properly and understand exactly how everything works. Over-the-top marketing and a sense of urgency are also tell-tale signs of a bogus investment. So be wary if someone is pushing you to come on-board quickly or you’ll miss your shot.