Junk Mail – Offers for Free Dinners at Investment Seminars

by Marie on July 4, 2012 · 5 comments

Do you open your junk mail? Sometimes it pays.

Occasionally we receive a piece of mail with a dollar inside – from a company hoping we will be guilt tripped into performing some action for them. We usually pocket the dollar and burn the letter.

Once in a while we get a really good coupon or two.

Often, we (usually my husband) gets a batch of those return address stickers. Usually along with a request for a donation. Why don’t they ever send them to the woman of the household!!!

Free dinners at investment seminars.

Sometimes we get invitations to free dinners, more often now that we are over 60. Frequently they are for dinner at a popular local restaurant with pretty good food. Usually they are ‘investment seminars’ – “Come learn how to make your money last in retirement”. “How to invest in a down market”. “Plan your retirement income” and etc.

It’s not surprising that we receive these invitations. An alert on the Financial Industry Regulatory Association (FINRA) claims that 3 out of 5 investors over the age of 60 got such invitations in the past three years and that about 25% of those actually attended one event in that time frame. They were saavy investors, though because only 9% actually fell for the hard sell and bought securities or investments from the presenter.

The scam.

Investment advisers, brokers and other securities marketers are looking for new clients to buy their products.  Often the ‘seminar’ is a high pressure sales pitch.  Many times, incomplete information or over emphasized benefits are presented along with the techniques of reciprocity (you get the dinner, they get a sale); scarcity (you can only get this deal tonight) and other high pressure sales methods.

The experience.

Years ago, we actually attended one of these. The dinner was hosted by a broker (supposedly associated with one of the big wire houses – I don’t remember which). The event took all evening, from about 5 pm until about 9 pm. It was at a nice steakhouse  – one that is on the upscale side of the price range. We did get a nice dinner. After dinner, there was a presentation and a long sales pitch. We listened and squirmed, wanting to leave and get home so we could get some rest for the next day. We bought nothing and we gave no information. We were not contacted much afterward. Overall, it wasn’t an unpleasant experience. We felt we paid for our dinner by listening to the pitch, but didn’t feel obligated to buy because we had a ‘free’ dinner.

Other ways investment seminars are offered.

Junk mail isn’t the only avenue used by brokers and other’s dealing in securities investments for a living to offer free seminars.

You can find one in most local ‘communiversity’ classes (classes taught by community volunteers, usually held at a local school and charging only a small fee for participants). Heck, your company may even host one. Mine did.

My company brought in local financial advisers to teach a course that covered retirement saving and investing. The company offered it only to people 55 and over. As part of the course, the advisers offered to do a free financial plan – a value (they claimed) worth hundreds of dollars. At the seminar the advisers really played up the benefits of variable annuities. They did such a good job that one of my co-workers fell, hook, line and sinker for the pitch. She turned over her entire retirement savings to them to invest. I’m pretty sure she is back at work now!

Even Vanguard offers a ‘financial planning’ service. They, however, are very up front on their web site with the fact that their recommendations will put you into Vanguard mutual funds only – so if that’s not what you are looking for, don’t ask them to do a financial plan for you, even if it is free!

Don’t fall for the scam if you go for the ‘free’ dinner.

So, if you read your junk mail, and want that free dinner, be prepared to invest your time to pay for it and don’t feel obligated to buy something just because you got dinner!

  • You don’t owe the broker a sale for the dinner.
  • You don’t owe the charity a donation for the return address stickers.
  • You don’t owe the company a response because they sent you a dollar in the mail – unsolicited.
  • Heck, you don’t even have to get the junk mail (but it does help the USPS stay afloat).

FINRA, the SEC and AARP all warn against free dinner investment seminar scams. Be warned!

 Do you know anyone that has attended a free dinner investment seminar?  What was their experience like?  Would you ever attend one of these?

Marie at Family Money Values wants to help families understand the potential consequences of wealth. She encourages visitors to take the long view and pull all family generations together to nourish the family legacy and wealth.


{ 5 comments… read them below or add one }

1 krantcents July 4, 2012 at 12:12 pm

I have never accepted a free dinner from these emails. I have no problem saying no, but it is not worth the time I would be there.


2 Marie at FamilyMoneyValues July 4, 2012 at 1:13 pm

I will usually try something new once – unless I have been warned off by someone I trust.


3 JW @ AllThingsFinance July 6, 2012 at 12:31 am

Maybe it’s my age showing, but I’ve never heard of these types of dinner offers. I have been a licensed rep for over 9 years now, and I would leave my firm the day they made me start mailing dollars out. I do find that our older clients sign up for monthly newsletters from analysts they’ve never heard of. Most of these letters are obvious “pump and dump” schemes that investors must avoid at all costs.


4 Marie at FamilyMoneyValues July 6, 2012 at 10:31 am

Interesting…. probably is your age. We started getting them around age 50 ish – and not just from the small firms either!


5 Tom S August 13, 2012 at 3:12 pm

This is a classic con and advising people to use the trickster/marketer for free food lends too much benefit of the doubt to their ability to not fall for it in the moment.. Just my 2 cents


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