Psst! Want to be a millionaire?
You've received an 'exclusive' invitation to attend a 'premier
wealth event'. There will be motivational speakers. Their financial
secrets have the power to turn you into a millionaire within a few
It sounds great, but such claims are almost always over-hyped or
misleading. The recommended investments can be expensive, highly
risky and lose you money.
Here we explain some warning signs to help you recognise dodgy
investment seminars and avoid being ripped off.
with unlicenced speakers
Seminars often promise a motivational speaker who claims to be a
self-made millionaire, and who will share their secrets to
One seminar featured 'Four of Australia's greatest financial
superstars'. When ASIC checked them out, none of the presenters had
an Australian financial services (AFS)
licence. In fact, three of the four speakers were found to live
and work in the United States. Who knows if they were 'financial
superstars' or just slick salesmen?
Big promises equal big
Here are some promises typically made by dodgy investment
- Risk-free investments
- Be a millionaire in a few years
- Above average returns at little or no risk
- Government-approved investments
Check out the claims
Look carefully at the strategies suggested by the seminar to
achieve these results. Shares typically return around 10% a year,
year after year, and property about 6%, depending on the location.
If you're offered returns of 1-2% more than these typical returns,
get a second opinion and ask for a detailed written
Property deals offered at these seminars might include 'rent
guarantees' or 'discounts' for buying off the plan. They can
involve hidden fees and commissions. The properties can also be
Other seminars promote schemes that involve you lending money
with little or no security. Another twist is to get you to invest
in offshore schemes where you lose the protection of Australian
laws. You may never see your money again.
High fees for investment
Seminars often don't deliver any concrete investment
opportunities. The first event may be free. When you attend you
will be pressured to buy reports or books and 'sign up' for more
expensive seminars or educational courses. The only person making
any money will be the seminar organiser through the fees you
advice before you invest
Check the scheme is legal
Check ASIC Connect and search within 'banned and
disqualified' or the ACCC's Undertakings Register to see if
they have taken any action against the promoters. It is also worth
checking whether your state or territory consumer
affairs agency has taken any action against them. Even if the
seminar providers appear to have a clean slate, that doesn't mean
the scheme is safe or legal.
Get financial advice from someone not linked to the
If you attend a seminar, never make any decisions about money or
investments on the spot. Always give yourself time to consider
things calmly and seek independent financial advice. The atmosphere at
these events can be quite exciting - but not the right environment
for making rational decisions.
If you want to attend seminars, consider reputable providers
like the Australian Securities
Exchange and Department of Human Service's Financial Information
What happens if you change your mind about an investment?
If the promotional material does not clearly state that further
training or other services will be sold at the seminar, under the
Australian Consumer Law you have 10 business days to change your
mind if you sign up.
This applies if, for example, you agree to join an investment
club or enrol in a training course after being cold-called by a
If the seller doesn't tell you about this cooling-off period,
you are entitled to a longer cooling-off period. To find out
more, including details for relevant state and territory agencies,
visit the Australian Consumer Law
If you've been invited to a seminar that doesn't seem right or
if you're worried you have invested in a scam, you should report the scam.
Also warn family and friends so they don't fall for the same
The promises made by some investment
seminars sound enticing, but the reality often doesn't stack up.
Always watch out for claims that sound too good to be true and make
sure you get independent advice before you invest.
Last updated: 29 May 2018