May 17, 2017 / 5:06 PM / 8 months ago

YOUR MONEY-How to keep yourself safe from fake financial news

 (The writer is a Reuters contributor. The opinions expressed
are his own.)
    By Chris Taylor
    NEW YORK, May 17 (Reuters) - Hey, we have a great stock tip
for you - a stone-cold lock, guaranteed profits!
    Do you believe us? We hope not. 
    The bad news is that financial "fake news" does not present
itself as such very easily, and it is everywhere these days.
    A recent Harris Poll conducted for the American Institute of
CPAs (AICPA) found that 63 percent of Americans say that fake
news "has made it more difficult to make critical financial
    And it is not just suckers or confused seniors who are at
    The U.S. Securities and Exchange Commission (SEC) recently
issued an investor alert entitled "Beware of Stock
Recommendations on Investment Research Websites."
    The SEC also just charged a whopping 27 parties with fraud -
from company CEOs, to communications firm execs and writers -
all of whom conspired to talk up certain stocks and goose share
    The writers did not divulge that they were paid to do so -
and in some cases, explicitly (and falsely) stated that they
were not compensated. Some parties even engaged in "scalping,"
which is the unloading of inflated shares after issuing the
phony positive "news."
    "Fake news is a powerful tool for wrongdoers to profit at
the consumers' expense," said Neal Stern, a CPA and member of
AICPA's Financial Literacy Commission. "These articles are aimed
to purposely mislead people into believing they are being
presented with important financial information or insights that
are not supported by facts."
    According to the AICPA survey, such fakery is complicating
important issues, such as healthcare decisions (for 44 percent
of respondents). It is also muddying the waters for stock-market
investing (40 percent), retirement (36 percent) and buying or
selling a house (35 percent).
    It can be surprisingly difficult to tell the difference
between what is real and what is not, especially in an era where
we do not get our information from a single trusted news source.
Consider the venues where the SEC suggests keeping your guard up
against fake news include: social media, investment newsletters,
online ads, email, Internet chatrooms, direct mail, newspapers,
magazines, TV and radio.
    AICPA's Stern said fake financial news generally has three
objectives: to get clicks to drive traffic, to get sign-ups for
programs that charge them to solve whatever problem the fake
news is "reporting" on and outright scams to get money and
personal data.
    The following are a few tips for sorting through the
blizzard of fake financial news:
    * Trace the source. 
    If an outlet is unfamiliar to you, is riddled with typos or
grammatical mistakes, lacks hard evidence and cites unnamed
experts, or makes extreme claims, then be very wary, AICPA
    Try to corroborate the information by seeing whether the
news is being reported by known, legitimate outlets. Keep an
especially watchful eye for "spoofed" websites, purposefully
designed to look similar to those of well-known news
organizations, or "sponsored content" that looks like editorial
copy, but is actually an advertisement.
    * Crosscheck credentials.
    If an author's bio makes them out to be a Warren Buffett in
the making, your alarm should go off. The SEC advises to watch
out for fake or exaggerated credentials, and writers who use
pseudonyms to push multiple versions of the same story. If the
author claims to be a legitimate adviser, there are ways to
confirm that easily as well as any past violations or
disciplinary action at the SEC's Investment Adviser Public
Disclosure website ( or FINRA's BrokerCheck
    * Set up firewalls.
    Before you pull the trigger on an investment, pass the idea
by someone you trust like your significant other or your
financial planner, or perhaps both. Having those kinds of
personal circuit-breakers in place will help you avoid
spur-of-the-moment investment moves. 
    "Often my job is just to tell people, 'Please don't do
that,'" said Boston-based financial planner Chris Chen.
    * Educate yourself. 
    Transform yourself into a more sophisticated media consumer
by honing your bias-recognition skills. A good starting point is
the AICPA's financial education site (
If you have a specific question, the site's "Money Doctors" - a
panel of volunteer CPAs with personal-finance training - can
pitch in.
    * Take your time. 
    Fake financial news tends to thrive by suggesting that you
have to act right away or miss out on the opportunity of a
lifetime. That is a big, fluttering red flag.
    "Making a snap financial decision can be dangerous," said
    Instead, put the information aside and come back to it
later. Odds are it will not stand up to sober second thought.

 (Editing by G Crosse)
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below