Men easier prey for fraudsters: BCSC

Maybe you can blame it on testosterone, but when it comes to investment fraud, men are easy marks, according to a study by the British Columbia Securities Commission.

Using data compiled by the Canadian Securities Administrators (CSA) in 2006 and 2007, the BCSC found that while women are approached less frequently with shady investment opportunities, those who are presented with such a scheme tend not to fall victim as often as their male counterparts.

“In general, women investors are more risk-averse,” says Patricia Bowles, BCSC director, communications and education. “They are less likely to believe investing is a gamble, they put more trust in investment professionals, and they are less likely to believe in bending the rules to get ahead in life.”

According to the CSA report, Understanding the Social Impact of Investment Fraud, 36% of women reported that they had been approached by someone hawking a fraudulent investment, compared to 46% of men. Of those who were approached, just 10% of women fell for the scheme, compared to 15% of men.

And the boys don’t seem to learn their lesson either, as 32% who were defrauded fell for scams more than once. Among women, the rate was just 20%.

Despite this data, however, more women than men reported that they were not confident in their ability to research investments. As a result, women tended to rely more on investment advisors, which may have helped them avoid the fraudulent offers.

“Seeking the advice of a financial advisor is something the BCSC encourages,” says Bowles. “However, it is imperative that people ask questions and do their research when investing in order to better protect themselves from investment fraud.”

The research is based on two national online surveys of more than 5,000 Canadian adults in both 2006 and 2007. Each survey is considered accurate within 1.3%, 19 times out of 20.

Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com