The Great Event…Go to the Back of the Room Scam!

If you’ve been in the financial scene for long enough, you’ve undoubtedly encountered the following: an invitation to a can’t-miss event or dinner hosted by a guru in the industry. As you peruse the offer, you undoubtedly think to yourself that it (whatever “it” is) could really be useful to you. So you take the plunge, thinking that worst case, at least you could turn it into a dinner date with your significant other and have an enjoyable evening. What’s the worst that could happen?

The night of the event, you listen to the presentation, and naturally there is an offer made that necessitates you make a decision on the spot in order to maximize the benefits presented to you, and it’s first come first served with a limit on how many people will get lucky. And the only thing you have to do is make your way to the back of the room, present your credit card, and enjoy all the life-altering benefits that have been promised to you. Sound familiar?

There’s an old saying that may not be well-known, but is invaluable in these situations: “Those that do, do, and those that don’t, teach.” Whereas that may sound harsh and does not apply in all instances (after all, we in society do need teachers), in many circumstances such as these events/dinners there may be no more pertinent information than this. Why is this so?

Let’s start with some exceptions, as there are some companies that do invaluable work around Tax Strategies, Real Estate Investment, and Asset Protection to name a few. There may be no better way to communicate than in a face-to-face setting. After all, it is much easier for prospective clients to get a feel for whom they might be dealing with by personal interaction. However, those that are honest and are offering something that remains viable are the exception for a reason. That reason?

Put simply, it’s human nature. Suppose that during the Gold Rush (or for that matter, the days of oil speculation) in the Old West someone were to literally strike gold. What are they most likely to do, collect as much of it as humanly possible, or go and tell everyone else about it, thereby diluting their own profits? The answer is clear. 

This brings us back to the aforementioned events. I have been to countless such happenings in my lifetime, and have heard the stories of many friends and family members who have attended them in my place as well. And every time, it’s been the same old story. I would sit there thinking, “this time will be different. This opportunity will change everything for me.” The unfortunate fact is that the person making the presentation has already milked the opportunity for all it is worth. And not only is that not enough, but they are now taking it even further by selling their knowledge for thousands of dollars, only that knowledge is worth pennies on the dollar to its original value. In essence, the opportunity at the event isn’t yours, it’s THEIRS.

A bit of common sense goes a long way in these instances. There are a limited amount of resources, and you are in a room with a bunch of other people. Not only that, but the presenter is going from city to city offering countless other people the same thing. How can any of this be a unique opportunity? Put plainly, if you are getting a “tip” at such a meeting, it is anything but. It is not new, it is not unique, and it is not worth your money.

The best advice to take away from this is that if something is useful and unique on the day of the presentation, it will remain so the following day. The pressure they are putting on you is how they make money, not you. If a company is serious about your prospects, they will give you the time to step back and do your due diligence, without applying any pressure. Any other behavior on their part is the ultimate red flag, which you need to see as a means to part you from your money by making a decision that you never would have had you had the time to step back and think clearly.