Investor's Watchdog.com: Stock, finance and investment protection for investors

We are reviewing the scenes playing out in the crystal ball that nearly twenty years of protecting investors (including six in the Enforcement Division of the U.S. Securities and Exchange Commission) has given me.  Today I see pitches for cleverly-disguised scams tied to companies that will supposedly benefit from a change in adminsitratiions in Washington - alternative energy companies.

Just as President Kennedy set a goal of reaching the moon by the end of the 1960’s and poured enormous resources into making it happen, President Obama plans to challenge the country to break our dependence on foreign oil.  He plans to pour resources into the effort in a way that will set American ingenuity loose to do what it does best.  God willing, President McCain would pursue the same challenge. 

Whichever candidate wins the White House, then, alternative energy will remain in the news.  Scam artists will take notice and structure their scams around companies that supposedly have developed successful clean energy technology.  Look for pitches for investment in companies that make cars that run on something besides gasoline.  Look for pitches for investment in wind, solar, and nuclear power.

We have posted on energy scams before and will continue to follow them.  Baby boomers and seniors who want to protect nest eggs that it took them decades to accumulate will follow this blog for additional posts on clean energy scams.  Those who need those nest eggs and/or are interested in passing a financial legacy to their children and grandchildren will investigate through Investor’s Watchdog before investing even a dime of their nest egg in such a company. 

Why do scam artists follow the headlines so closely?  Their work requires that they establish credibility with their intended victims.  Think of it this way - if someone where to approach you with an offer of an investment in a company that says it can mine gold from the planet Mercury, how long would you listen?  Not long.  The scam artist who chooses to pitch such a company would have to spend many hours and many thousands of dollars convincing you that such a venture is viable.  Not so with the pitch about an alternative energy company.  Choosing a story in the news as the starting point gives the pitch instant credibility - you know of the need for what the company can do because you’ve seen that need covered in the press.  Credibility is key.

In our next post in this series (on Friday) we will cover other scams that might appear more credible in light of a change in the occupant of the White House.