Cryptocurrencies are topping the list of threats investors are facing according to the Minnesota Dept. of Commerce.
ROCHESTER, Minn. - The Minnesota Department of Commerce is flagging risks investors should watch out for this year.
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The agency's list of top threats facing Minnesotans putting their money to work in 2022 is geared toward investors looking to grow their wealth, rather than do something with their extra cash.
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It may come as little surprise most of the risks highlighted by MDC target online investors. Minnesota Commerce is warning of the volatility of cryptocurrencies, which have gained increasing visibility through digital platforms, social media, and advertisements featuring celebrities.
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MDC says while online trends may popularize these products, they may not tell the full story when it comes to crypto.
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"We want people to consider what the volatility is if they are buying crypto as a reason to grow wealth, because when you have a lot of volatility, that means that you can lose your money," said Mo Schriner, spokesperson for the Minnesota Department of Commerce.Â
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Other practices being flagged by the agency include offers related to promissory notes, investment opportunities sent via social media or the internet, and financial schemes connected to self-directed individual retirement accounts. MDC also warns Minnesotans taking up offers to buy gold online may not find their pot at the end of the rainbow.
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"Investments to buy gold, like gold products or gold coins, that's another one where you want to really take a look and do your homework on those kinds of investments, because if you're going to get charged fees for making those kinds of investments, that it's not going to be worth the money that you would make from buying those investments," Schriner told KIMT.
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MDC is urging investors to stay informed, and research anyone offering to manage their money. Some tips the agency suggests - watch out for fake client reviews, excessive fees or premiums, and lookalike websites and accounts.
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"If it sounds too good to be true, take another look at it. This is really a situation where you need to do your homework before you invest your hard-earned money," Schriner said.
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The Minnesota Department of Commerce says its list of top investor threats in 2022 were determined by a survey of securities regulators, conducted by the North American Securities Administrators Association (NASAA). You can find additional recommendations and warnings by following this link.
