If you get an unsolicited telephone call about an investment opportunity, be alert to the signs of fraud, warns the Ontario Securities Commission. You might be a target of a boiler room operation.

Boiler room operations wear many disguises, and they are once again rearing their ugly head in Ontario. Boiler room operators hope to give you a false sense of security with promises of quick profits – but the only ones that profit are the scam artists, at your expense.

They may be located in the financial district near reputable firms, but their address may be nothing more than a rented space tucked away from the public eye. Rarely, if ever, are the offers they peddle to your benefit. Why would a complete stranger call to offer you a no-risk, high-return investment? It is too good to be true.

To gain your trust, the salesperson may boast of a business idea that sounds probable - perhaps a company in the medical industry with a new technological breakthrough for detecting cancer. The pitch is that with your investment, the company could go public on the stock exchange and make you more money. The scam artist may also try to play on your sympathies - he or she may know that cancer has taken the life of someone dear to you. Or perhaps they know that you are a busy professional, with extra income to invest, and little time to do your own research. Regardless of the background, the investment opportunity will be sold on the promise of quick profits.

If the offer is really such a great deal, there should be no need for a broker to cold call strangers to promote it. Ask yourself why they are calling you. To avoid becoming a victim of a boiler room, watch out for:

• Unsolicited phone calls. Don't be afraid to tell a salesperson not to call again, or to simply hang up.
  
• High pressure sales tactics and repeat callers. Take the time to research any investment opportunity and get a second opinion.
  
• Promises of high returns with no risk. Any investment that offers returns higher than the bank rate has risk. If you invest in a high-risk investment, you must be financially prepared to lose your money.
  
• Setups. With the first call, the scam artist may only try to gain your trust by offering information about the company and their alleged success. This is a setup for future calls, when you will be pressured to buy.
  
• Unregistered salespersons. Check the registration of the person offering you the investment. Call the OSC Contact Centre toll-free at 1-877-785-1555 to verify that they are registered, and what services they are registered to provide.
  

If you suspect a scam, try to collect as much information as possible about the caller, their name and the company's name, the investment, and the date and time of the call, and contact the Ontario Securities Commission at 1-877-785-1555. You can learn more about investment fraud and other investment topics on-line at www.investorED.ca.