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Lack of Knowledge Makes You a Prime Target for Fraud  

 

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In this edition we have provided you information on "Affinity Fraud" and "5 Tips to Avoid Affinity Fraud". 

 

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Thomas M. Rucke, President
Cadfael Investigative Group, Inc.

Affinity Fraud


I first heard the term "affinity fraud" in the 1980's while discussing the fraudulent activities of Jim and Tammy Bakker of PTL (Praise the Lord) ministries. Monies given to the ministry were put to questionable use, such as buying the silence of Jessica Hahn who claimed a forced sexual encounter with Jim Bakker, which ultimately led to a close examination of the Bakker's opulent lifestyle. Affinity fraud refers to "investment scams that prey upon members of identifiable groups, such as religious or ethnic communities, the elderly, or professional groups. The fraudsters who promote affinity scams frequently are - or pretend to be - members of the group. They often enlist respected community or religious leaders from within the group to spread the word about the scheme." (http://definitions.uslegal.com/a/affinity-fraud).

 

The largest hurdle to overcome in fraud is trust. By faking membership in a group, the fraudster is viewed with less suspicion. Once the scammer gains the trust of members of the targeted group his scam spreads like wild fire through the community. Very little if any scrutiny is given to the operator or his scheme. Oftentimes the scheme offers to pay investors large amounts of interest, such as 20% per year, which is almost impossible to achieve and ridiculous to guarantee.  

 

Affinity fraud almost always involves either a fake investment or an investment where the fraudster lies about... Read More  

 


5 Tips on How To Avoid Affinity Fraud 

 

After reading the first part of this newsletter you should have a better idea of what an affinity fraud is and perhaps you can now better recognize one. The key is that the fraud operator pretends to be "one of us" in order to gain your trust and avoid the level of scrutiny that would reveal the fraudster for who he actually is. Here are a few tips for protecting yourself from affinity fraud:

  1. Even if you know the person making an investment offer, be sure to research the person's background, as well as the background of the investment itself. Be aware that the person telling you about the investment may be trustworthy, but may have been fooled into believing that the investment is legitimate when it is not. 
     
  2. Never make an investment based solely on the recommendation of a member of an organization or group to which you belong, especially if the recommendation is made online. An investment pitch made through an online group, in a chat room, or on a bulletin board may be a fraud. If you invest, invest in a professional organization with professional representatives who can sit down with you face to face. 
     
  3. Do not fall for investments that promise... Read More  
 August 2013
In This Issue
Affinity Fraud
5 Tips on How To Avoid Affinity Fraud
Fraud Tip
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Fraud Tip

Investment opportunities must be closely scrutinized by an experienced investigator.  It is better to pay a little than lose a lot. While you are at it, have background investigations done to protect your business.

   

In Short: Got Fraud? 
Call Cadfael!

 

 


If you suspect fraud or are troubled by an offer, call us with the information. We can help you identify if it is a fraud. Remember, if something appears too good to be true, it usually is.


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About Us
At Cadfael Investigative Group, Inc. we help our clients' identify and eradicate fraud. We provide them with the power of knowledge. We bring added information and insight to clarify and understand challenges they face.

Our investigative focus is on fraud identification and prevention in the legal and business communities of Minneapolis, MN. Our focus in the area of our expertise allows our experienced investigators to utilize their skills and gives our clients good value for their investment and an economic advantage. We provide our clients information they need to protect their clients and business. We also provide them with new services and capabilities that free up their time so they can focus on what they do best.

Our clients benefit by improved employee loyalty, increased profitability, and less time and resources spent managing internal losses. Learn more...


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