NSSC Blog: Before You Invest

Fraudster Friday: Bernie Madoff

Bernard Lawrence Madoff perpetrated the largest financial fraud in American History. It is estimated he bilked his 4,800 clients out of $64.8 billion.

Madoff got into the investment industry in 1960 when he founded Bernard L. Madoff Investment Securities LLC. Over the next four decades before his criminal deeds came to light, he was a respected adviser, businessman and philanthropist, and even held the position of chairman with the NASDAQ for many years.

Fraudster Friday: Charles Ponzi

Arguably the most infamous fraudster in history, everyone knows the name Charles Ponzi. They may know the name, but that doesn’t mean they know the story behind the man who swindled thousands of people out of $20 million in the 1920s.

Originally born Carlo Pietro Giovanni Guglielmo Tebaldo Ponzi in Italy in 1882, Charles Ponzi, an Italian immigrant, lived in Boston in 1919 when he stumbled upon a money-making investment scheme: international reply coupons.

March is Fraud Prevention Month!

March is Fraud Prevention Month! All month long we will be sharing special content on investment fraud. This will include our regular Question of the Week posts every Wednesday, as well as a special series on Friday, we’re calling Fraudster Fridays. Every Friday we’ll be sharing the story of a famous investment fraud, how they scammed their victims and how you can hopefully avoid falling prey to the next big scam artist.

Question of the week: What is a private placement offering?

In the news last week, a Canadian company announced a private placement offering. That led to the question, what is that exactly? A private placement offering is a way for a company (public or private) to raise capital. However, it differs from a regular public offering where securities are made available for sale in the open market to any type of investor, typically through a stock exchange for common shares.

Question of the week: What is active management?

Active management is an investment strategy where an investment manager makes specific investments in an effort to outperform an investment benchmark or market index, such as the TSX or S&P 500. If you hear of an investor or an investment manager trying to “beat the market” they are using active management to try and obtain better than market-average returns.

Question of the week: What is a REIT?

A Real Estate Investment Trust (REIT) is an investment vehicle that invests predominantly in income-producing real estate. This income-producing real estate can include offices and apartments, warehouses, shopping centres, hotels and parking garages. REITs may be publicly traded or private trust relying on a prospectus exemption.