SEC Issues Updated Investor Alert on Social Media and Investing

The SEC Office of Investor Education and Advocacy issued an updated Investor Alert to warn investors about fraudsters who may utilize social media to spread false or misleading information about stocks.

The Investor Alert stated that the key to avoiding investment fraud on the Internet is to be an educated investor.

The Investor Alert provided a list of five tips to help investors avoid becoming the victims of fraud:

• be wary of unsolicited offers to invest;
• look out for red flags, such as claims that are too good to be true;
• remain alert to "affinity fraud," since an investment can be risky even if the person making the offer is trustworthy; and
• ask questions and check out everything.

See: Updated SEC Investor Alert.Related news: SEC Issues Investor Alert on Social Media and Investing: Stock Rumors (July 25, 2014).