The world of business and economy is anything but a predictable and sure one. A career in one of the many submarkets that deal with investments and trading can be very overwhelming and difficult, often annoying and outright frustrating. However, if done right and with a little luck on your side, you can truly do wonderful things and be very successful. The important thing to keep in mind is that it is near impossible to do everything on your own.

You will surely require some form of help along the way particularly with highly specific moves and things you lack the necessary expertise in. One of the ways you can help your cause if by hiring a broker to aid you along the way. Their skills and experience in the branch of business you are dealing with is priceless and it is all the help you can ask for on the road to success. However, there are also those looking to take advantage of you.

Stuff like this is common no matter the field of work and there will always be those looking to scam honest and unsuspecting folk. In order to determine whether or not a broker is legit or not, you have to know what to look for and be able to identify the red flags on time. In this article we will help you with the right information on how exactly to do this. Being stuck with an illegitimate broker can be a nightmare so here we will focus on preventing such problems and identifying false brokers on time. For additional info on the matter, learn more by visiting  

Suspicious Ways of Reaching Out 


Brokers and investment advisors who have contacted you on their own, out of the blue, and with no apparent ties to a larger operation or a company you dealt with in the past is enough cause to be concerned. Such an instance may come via phone call, an email, or even a letter to your mailbox.

Most often, they will ask you to attend a seminar where you will be able to learn more about their ways of helping people. There is usually an incentive like a free lunch or dinner while you watch a presentation and listen to the speakers, or even gifts that are there as a way to make people believe in their good intentions. This is no way to do business and sadly, brokers use such tactics all the time.

Actually, they rely on it so much that people nowadays know about the infamous lunch or dinner presentations and similar tactics. Other than that, if they employ overly aggressive and high pressure tactics while talking to you and use language like once in a life time opportunity, it is best to ignore the broker completely. 

Research and More Research


We live in a digital age, also called the age of information. It got these names for a reason and therefore you should use the means you have around you to learn more about things in your life. The online world is ripe with things to be read and explored, making it the best place to do research no matter what or who you are interested in. Before you agree to even meet with a broker and listen to their offer, you should do extensive research on the web and look for their reviews and ratings.

There are websites that rate everything these days and a simple Google search will give you all the info you require. More importantly, you will need first-hand information about how well the broker does their job and how safe your investments will be in their hands. For this, you will need to find reviews by past clients who have shared their stories.

It does not matter if they are positive or negative because you will know much more than you knew. A potential problem would be if there are no reviews to be found, since it either means the broker is a complete beginner or that they are not legitimate. Going old-school and asking for the best person for the job in your community is another great way to learn more about them from the people who know the broker.

Education, Permits, Memberships


While you are still negotiating the terms and evaluating your options, you should definitely ask the broker about their background. Experience is not enough and if they focus too much on a few past clients, they could be hiding something. You have to know if they have the right educational background for your specific case.

Not all investments are the same and each different market requires certain specifics. Therefore, have a talk about their education. This can lead to a few questions on your side regarding their certificates, permits, and similar things that clearly state that they are indeed a professional broker and an expert in the field of investment.

Lastly, they should be a verified member of the Securities Investor Protection Corporation, or SIPC, which is a non-profit which protects the investors. It works similarly to the way the Federal Deposit Insurance Corporation protects the bank customers. Whenever you plan to invest with a broker, make sure they are a SIPC member and not an individual broker working on their own. 

Conclusion and Takeaways

You already know how treacherous the whole investment game could be and how quickly you can lose your investments if the people handling your money only care about their profit. Brokers are there to help people with their business moves and everything else should come second.

If you do not want to be taken advantage of, you should think long and hard whom you trust with your hard earned money especially if you are taking a portion of your life savings. There are some truly amazing financial professionals and advisors out there who care deeply about every single client as well as their own reputation. All it takes is some additional time and dedication before you find them so do not rush it and settle for a fraudster in disguise.