Today, U.S. Attorney Brandon J. Fremin announced that Todd Mixon, 50, of Louisiana, has pleaded guilty to wire fraud.

According to his guilty plea, Mixon sent his victims text messages with screenshots of fake trades and emails with fake account statements through the trading platform, luring them into fraud. The money Mixon fraudulently obtained from his victims was not put into the market, but diverted to enrich himself. By the time of the crime, Mixon had defrauded at least 47 victims of up to $550,000.

Scammers are everywhere

"I've always found the psychology behind investment scams fascinating," says Brad Brain, a Canadian financial planner who has studied telecommunications fraud. I'm not talking about pure theft without prior warning, but people taking the risk to engage in it knowing the risks."

In British Columbia, Canada, many victims lose millions of dollars to scams every year. Fraudsters are trying to seduce you, whether it's an email from someone you've never contacted, or buying you coffee from someone you've never contacted. If someone is exaggerating, assuring you that a certain project package will not lose money, high returns, then you have to be careful!

Emotional fraud

Today, many scams are spread through social media and may also contact you via email, phone, in-person contact, or even fax. One of the most difficult types of fraud to defend against is emotional fraud, which is often referred to as "pig-killing" fraud. Emotional fraud is when fraudsters gain the trust of some people and then use that trust to gain the approval of more people. Emotional fraud is so successful because when we have a common background with others, we trust them and let our guard down.

The most famous scheme in the world is the Ponzi scheme, which is a classic pyramid scheme. When there is new money coming in, it is used to pay interest to early investors, which makes the investors look profitable. Once the project gained public acceptance, spread word, and began to collect large amounts of deposits, the founders would abscond with the money.

Scams can take many forms, and here are some examples. You may be tempted by some big, empty promises: like cryptocurrency or blockchain technology, gold or precious metal deposits, oil and gas limited partnerships, or real estate ventures. Perhaps you have the opportunity to create wealth through some unique methods such as binary options, offshore investing, prime bank loans and financial derivatives trading, and scammers will urge you: "Forget those boring retirement savings plans and tax-free savings!" "Or" It's now or never. What are you waiting for?"

Use threats and intimidation to defraud

However, not all fraudsters are trying to lure you in with a big payoff, and they may also use other intimidation tactics, such as an audit by the Canada Revenue Agency, a visit from the police, and the disclosure of your Internet browsing history to get you to pay them money.

How do you recognize the red flags of investment fraud?

The simplest red flag is the promise of big returns with little or no risk. Other red flags are lack of proper documentation, avoidance of answering your queries, and refusal to provide further information, confidential explanations of the offer, lack of any licenses or certifications, use of peer pressure, and high-pressure tactics to encourage you to make a quick decision.

"I've met a lot of people in Fort St. John over the years who have fallen for this type of scam," Brad Brain said. "I hope you're not the next victim."