Any time money is on the line, there is a chance you may be scammed. The same holds true when you are investing in oil and gas wells. An oil and gas investment can produce significant returns, but the promise of untold riches can blind investors to the truth. This is why it’s critical to know how to invest in oil and gas through appropriate channels so you can get the returns you expect from this type of investment.
Watch for Red Flags
Before you enter into any oil and gas investment, it’s important to make sure you are getting involved in something legitimate. While an investment can sound amazing when you first hear it, there are certain red flags that will almost certainly be raised. Some common warning signs you are being scammed include:
- Guaranteed results and other promises of “can’t wait” wells
- A sales pitch based on widely publicized news
- Limited opportunities
- Unbelievably high returns on your investment
- Unsolicited offers or materials
- Promises of tips and secrets regarding how to invest in oil and gas
Like any other scam, if it sounds too good to be true, chances are it is.
Most scammers offering the chance to invest in oil and gas will approach their targets via email or telephone. They rarely present their offers face-to-face because they prefer the anonymity of these methods of communication. They typically promise large returns with minimal risk in an effort to entice would-be investors to send money. Unfortunately, there are no oil and gas wells and these scammers take the money and disappear, leaving investors with nothing in return.
How Can You Protect Yourself?
Before you enter into any oil and gas investment, it’s important to do your research. There are several things you can do to protect yourself from investment scams. For instance, you should never be afraid to ask a lot of questions. Don’t take anything at face value. A legitimate salesperson will be happy to answer any questions and provide proof of their claims. It’s also essential to do your research. Never make an investment under pressure. Instead, ask for the name of the company and conduct a thorough search online. You should also reach out to the securities administrator in your state to inquire on the validity of the offer. This will help protect your funds and ensure you make a smart investment choice.
If you are interested in investing in oil and gas wells, it’s essential to make sure you aren’t at risk of falling victim to a scam. An oil and gas investment can be a lucrative opportunity if you take the right steps and do your research before committing any funds. It’s enticing to think about the significant returns these investments may provide, but it’s critical not to get caught up in the moment. Be smart and do your research.
If you’ve been thinking about an investment in oil and gas, contact us. We are a family owned and operated company in business for 20 years. Our oil and gas drilling programs are offered by Douglas Scott Securities, Inc., a reputable captive broker/dealer for investors in new projects.