How to Recognize a Free Lunch Seminar Investment Scam

More than 6 million Americans age 55 and older have attended a free lunch investment seminar. But most of these so-called seminars are actually sales presentations, where the attendees are often pressured into making unsuitable -- or even fraudulent -- investments. If a friend, neighbor, or relative accepts an invitation to one, make sure they know the score before they go.

You will need

  • Healthy skepticism
  • "How to Spot a Free Lunch Scam"

Step 1 Educate them Explain that many free-lunch seminar presenters claim that “nothing will be sold” at the actual presentation. But odds are anyone who goes will get a sales pitch at a later date — sometimes using high-pressure tactics.

Step 2 Ask the right questions If the presenter tries to sell anything, tell your friend to ask these 3 questions: Are you licensed to sell this product? Who are you registered with? And, is this investment registered with the U.S. Securities and Exchange Commission?

Step 3 Check the answers Stress the importance of checking the seller’s answers, and offer to help do it. Look for proof of registration of the seller and the product. “”: can walk you both through the vetting process. Or call (888) 295-7422.

Step 4 Report suspicious information Urge them to report any irregularities to the proper authorities — FINRA, the SEC, or their state securities or insurance regulator. “”: can help you determine where to report your suspicions.

Step 5 It’s OK to walk away If the professional is not registered and the product is not registered, tell your friend to walk away.

Step 6 Become a monitor Become a Free Lunch Monitor — someone who audits free-lunch financial seminars and workshops and reports any suspicious activities. You or your friend can download the Free Lunch Monitor tool kit at “”:, and use the checklist found in the how-to guide to rate investment presentations and submit your ratings to AARP.