Investing money is an important part of financial planning for individuals and families.
However, consumers lose more than $7.9 billion to investment scams annually, with a median individual loss of more than $10,000 in 2025, according to the Federal Trade Commission, or FTC.
An example of investment fraud is the recent conviction of Miles Burton Marshall, a Madison County, New York, tax preparer and insurance agent, who operated a massive Ponzi scheme that fraudulently stole more than $50 million from 988 investors in Madison County and nearby counties.
Marshall convinced unsuspecting clients to invest millions of dollars into his so-called “Eight Percent Fund,” claiming that their funds would be primarily used for real estate investments, New York Attorney General Letitia James said in a statement. Instead, Marshall used these funds to pay investment returns to prior investors and to cover the expenses of his other businesses and his personal expenses, including shopping, vacations, and trips to restaurants.
James said to further his scheme, Marshall directed his staff to generate fake “Transaction Summaries” for investors, falsely representing their account balances and the interest they purportedly earned. Marshall’s investors relied on these false statements, believing they were earning a steady income, and continued to invest.
“Miles Burton Marshall scammed his clients out of their life savings and used their hard-earned money to fuel a classic Ponzi scheme,” she said.
James said Marshall will be sentenced to four to 12 years in prison.
To help you spot and avoid investment scams, follow these tips from the Federal Trade Commission:
- Remember that investments always involve risk. If anyone plays down the risk of an investment or acts like risk disclosures are just a formality you don’t need to worry about, keep your money. Those are scammers who want you to think their opportunity is risk-free when it’s not.
- Check out the reputation of the investment company, its officials, and its promoters. Search online with their name plus words like “review,” “scam,” or “complaint.” Go through several pages of search results.
- Check for licenses and registrations. Many investment scams start with unlicensed people or unregistered firms, so use the search tool on Investor.gov to check out anyone recommending or selling investments. In addition, state securities regulators oversee investment advisers who manage less than $25 million. You can find out who your state securities regulator is by visiting the website of the North American Securities Administrators Association Inc. or by calling 202-737-0900. For investments in precious metals or coins, check out the CFTC database.
Take the time to thoroughly research any investment you’re considering. You don’t want to lose your life savings to a scammer who is living a lavish lifestyle on your money.
