The Alberta Securities Commission is warning provincial residents of a possible investment fraud that is carried out through affiliations with religious groups.
In response to recent inquiries made to commission, investors are being warned to be cautious of individuals who use their affiliations with religious organizations to solicit members of such groups for investment opportunities.
“Religious affiliations aside, investors should be taking care in selecting their investments and investment advisers. There is nothing wrong with dealing with an adviser who shares your religious beliefs, but using that as your only criteria for selecting an investment is not enough,” said Wayne Alford, ASC director of enforcement.
“There are many unscrupulous individuals who will use any method to gain your trust and take your money,” Alford said. “Because religion relies on faith, scam artists can often obtain trust through that faith.”
nvestors are warned to look out for the following warning signs:
- predictions of imminent financial or social crisis;
- claims to reinvest portions of profits in worthy causes;
- investment salespeople who equate faith in their investment opportunity to religious faith;
- requests to keep your investment confidential; and
- promises of high returns and low risk.
“Many people think that because an investment has been referred to them from someone who shares their faith or religious beliefs, that it’s a safe investment.” added Alford. “That is simply not the case. No matter who the recommendation comes from, people need to investigate before they invest.”
Religion-based or “affinity” scams are not a new phenomenon in Canada. From 1995 to 1997, former Seventh Day Adventist church pastor, Gary Stanhiser used his religious affiliation to bilk more than $11 million from 300 investors in British Columbia and California.