OIL AND GAS INVESTMENT SCAM – WHAT YOU NEED TO KNOW AS AN INVESTOR
OIL AND GAS INVESTMENT SCAM – WHAT YOU NEED TO KNOW AS AN INVESTOR
OIL AND GAS INVESTMENT SCAMS
Investing your money, no matter the industry, can be a scary thing. It can be an especially scary thing when understanding there is the possibility of getting scammed, and the oil and gas industry is no different when it comes to that possibility.
There are some companies that try to gain investors within the oil and gas industry, promising them a high return on their investment when truly their plan is a lot more deceitful. It is to take your investment and only give you a slight return back, if anything at all.
On the other side, there are legitimate companies that truly want to help you succeed, by helping you invest your money in the right places. It can be hard to see the differences as an investor, especially with little to zero knowledge on the way scammers work.
Fortunately, I am here to help. Here are some important points to triple-check before making an investment in the oil and gas industry.
DO THE RESEARCH
Before buying a car, before moving, before starting a new job, it is always important to do your research about the topic. Becoming an investor in oil and gas is no different. You should have a complete understanding of the benefits and risks before committing. When choosing to invest in something such as oil and gas, you need to have a clear understanding because let’s face it, to invest in oil and gas you need to have a large amount of money.
Let’s say you get a call from a salesperson about investing with his/her company. They offer you this big investment idea and want to get you on board right away. They overload you with exciting information about ways you will make money if you invest with them, yet you still have questions.
So ask those questions. Don’t be afraid to ask tough questions, specific questions. Find out as much as you can about the company: where they are located, how long they have been around, who the CEO is, where the drilling wells are located? Questions like these will help you be able to research the company to find out if they are legit.
PAST, CURRENT AND FUTURE TOPICS
The salesperson may try to use current news to persuade you into thinking the industry is rainbows and butterflies. Make sure you are doing research on history and future predictions of the industry, not just current topics. The more resources the better. Use different websites, governmental agencies, newspapers and magazines to get an understanding. This will also provide you with many opinions on the topic, not just a one-sided view.
It is also okay to ask the salesperson personal questions. Questions such as: where they are calling from, what will their commission be if you decide to invest, what other compensation will they receive? Make sure to get their full name as well. You can then find out if the person has any prior violations of securities laws by contacting the state security agency in which you live in, or the state in which they said they are calling you from.
WHO TO CONTACT
There are several different businesses that you can contact before deciding whether or not to invest with a certain company. Like I mentioned before, asking the tough questions can help you decided.
Some other hard questions would be to ask the salesperson if the investment being offered is registered with the state security commission. If the salesperson is in a different state than you, ask them if it is registered in their state. If they claim that the offer is exempt, ask them for the terms of exemption. To make sure it is in fact exempt, contact your state security agency.
SECURITIES AND EXCHANGE COMMISSION (SEC)
The securities and exchange commission (SEC) is an organization created to protect investors. They provide a fair and adequate market and capital formation. If you have any questions or concerns SEC is available to help. You can file a tip or complaint easily via their website.
TOO GOOD TO BE TRUE
Investing in technology, investing in Coca-Cola products, investing in the newest Apple stock all come with a probability of endangerment. There isn’t anything in life that does not come with some kind of risk.
If someone is trying to convince you that it is 100 percent safe or that the risks are so low hang up the phone, walk out or delete that email because they are lying to you. It is a risk, a high risk, with your hard-earned money on the line. There is always a risk when making an investment in the oil and has industry because there is no bulletproof, perfected, exact way to predict what will happen.
It is important to understand the salesperson are trained professionals. They are taught to say specific, quote on quote information to lead you in the direction they want. If it sounds to good to be true, there is a high probability it is.
METHODS OF SCAMMING
Unfortunately, there are many methods used to scam investors in the oil and gas industry. Here are some of the top ways used that you should watch out for when looking to invest.
Many high-pressured salespeople will try to convince you that it is a once-in-a-lifetime opportunity and that you must invest your money right then or the offer will disappear. This is a tool scammers will use as they catch you off guard. They will try to guide you into making an impulsive, irrational decision. Don’t fall victim.
To invest, it requires thousands of dollars. It is important to make sure that the fees they are requiring you to pay to become an investor are not more than the expected profit they are claiming you will make.
If the salesperson says something along the lines that this is a unique offer, a confidential opportunity, this is not offered to everyone, etc. security officials want to warn future investors to be cautious of these statements.
Like I mentioned before, the salesmen are trained professionals. They are provided a script that is meant to entice you into making an impulsive commitment. All those statements sound good, but it is hard to tell if they are true. Ask for hard proof evidence that these statements are in fact true. If they cannot be backed up, it is possible you are being scammed.
Other statements regulators want to warn investors about is if the salesperson is saying he/she received a tip about a new well, there are only a few spots left or this well is guaranteed to do bring in revenue. Just remember to be wary of these statements. Anything that cannot offer hard proof evidence might be a scam.
The salesperson may promise you that you will receive a high return soon. It is crucial to know that it takes time, as in years, to receive a high return on your investment in the oil and gas industry. If you are looking to invest and make a quick return, the oil and gas industry is not the industry for you.
ASK AN ADVISER
You should never feel rushed into having to decide to invest right away. Investing in something should take a lot of time to think about and be reviewed before committing. It should never be an impulsive decision.
Getting a second opinion is always a great way to help assure yourself that you are making the right decision. It is always a good idea, for any issue, to consult with someone or a few people who you trust about your future plans.
Speaking with your loved ones, an old co-worker, anyone that you respect their opinion and feel would give you good advice should be talked to. There should be nothing that is so rushed that you cannot get a second opinion on. Reaching out to other resources before making an investment is a great way to better understand what you are getting yourself into. Scammers may try to discourage you from discussing with someone, that is a red flag.
GET IT IN WRITING
Always make sure it is in writing. A contract should always be in place explaining exactly what the process is, the goals and how they will be achieved. It should be a well thought out explanation that is very detailed in all aspects. There should be zero confusion when reading the contract and nothing left out. If you have a question or something is not 100 percent clear than do not sign the contract until it is fixed. There should be absolutely no questions after reading the contract. Read the fine print.
POSITIVES, IT CAN BRING YOU MONEY
With the right information, after taking your time and doing research, after talking with a financial adviser and your loved ones, after making a sought out plan, after asking the tough questions and getting the answers, investing in oil and gas can be a wonderful investment for you that brings in high revenue.
Investing in the oil and gas industry does require you to take risks, but so does a lot of things in life. Taking chances is what helps you grow, and the oil and gas industry has the potential to do that.
There are huge benefits when investing in oil and gas besides bringing in monthly revenue which includes a large tax deduction. A tax deduction that is often between $70,000 to $90,000.
But, investing in oil and gas is not for everyone.
IS THIS THE RIGHT OPTION FOR YOU?
Investing in the industry is not a bad idea but investing with the wrong company is.
If you are interested in learning more about investing in oil and gas, contact us by clicking on the link below and fill out the “Contact Us to Invest” box. Someone will reach out to you. Together we can decide if investing with Swan Energy, Inc is the right fit for you.
I hope that these tools and resources will be able to help you understand and evaluate the differences between a good company and a scamming company.
For any questions, concerns or comments, or if you would like more information visit our website: