How to avoid investment scams

The Financial Services Board (FSB) recently advised the industry that despite its licence being withdrawn in August 2013, Mentor Life Cover and Investment Ltd continues to render financial services without authorisation, and further warned the public against dealing with MBB Legacy Investment Group, another entity not licensed in terms of the FAIS Act and thus not authorised to render financial services. How many consumers are aware of these warnings is questionable.

It is therefore not surprising that despite FSB warnings and the number of determinations handled by the FAIS Ombud each year, many South Africans are still being swindled into investment scams. One of the latest determinations handed down by the FAIS Ombud involved a widow who was defrauded of the money received from her late husband's life insurance policy after investing it with a financial advisor who worked for Nedbank, and swindled Beukes into investing into his newly established company, Jam Financial Planning. In another case, an investor invested R100 000 with iBear and R200 000 through Blue Platinum Investments in various blue chip shares and commodities on the JSE, but was swindled out of R180 000. Investors should note that the Ombud can only deal with cases up to the value of R800 000.

"The only way investors can completely avoid investment scams is to retain absolute control of their hard-earned money. It is one of the core principles of the P3 Investment System: never create a distance between yourself and your money," notes Dr Koos du Toit, CEO of P3 Investment Group. "At P3, we believe you should never give your hard-earned money to an unknown third party to invest on your behalf! You should always keep 100% control over your invested money. You should know exactly where your money is and what it is doing - preferably where you can see and touch it."

The one investment that allows investors to have 100% control over their hard-earned money and keep it where they can see and touch it, is bricks-and-mortar. And a well-chosen buy-to-let property will not only protect your investment by producing steady capital growth year after year, but will also generate an ongoing, passive monthly income that keeps pace with inflation, year after year.The ability to generate both capital growth and passive, ongoing income, without relinquish control of the investment to any institution or individual, are the reasons why direct property investment remains the top asset choice for the world's wealthiest.

The reason why investors in buy-to-let property can retain absolute control is because buy-to-let property investment is stunning in its simplicity: you obtain a home loan to buy a property, which you then rent out to a tenant. The rental from the tenant covers the bulk of the bond repayments, so your own monthly investment is a relatively small amount. However, as the rental increases every year, but the bond repayment amount stays the same, the rental soon - within three to eight years - covers the entire bond repayment and other expenses, which means the property starts generating an income for you. Once the bond is paid off, the bulk of the rental amount becomes income in your pocket - every month for as long as you, and your children, own the property - and you never have to work for it! And, while you are earning this income every month, which keeps pace with inflation over time, the property is also increasing in value.

"Over the last 10 years, the P3 Investment Group has helped thousands of South Africans to avoid investment scams and the risks involved in handing their hard-earned money over to an unknown third party to invest on their behalf," concludes Dr du Toit. "Instead, we help investors to keep 100% control of their money through an investment in brick-and-mortar where they can see and touch it. To invest in an income-generating and capital growth-producing buy-to-let property, investors don't need qualifications or experience, or much time, training or effort, or a lump sum to invest or even a monthly investment that is more than current retirement savings. All that is required is the willingness to take responsibility for growing and protecting their own hard-earned money and their own financial future, by implementing the steps they will find at"

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