Profiling Victims of Investment Fraud: Mindsets and Risky Behaviors

Marguerite Deliema, Doug Shadel, Karla Pak

Research output: Contribution to journalArticlepeer-review

31 Scopus citations


Millions of Americans are targeted by investment scams, resulting in billions of dollars lost each year. Previous research indicates that investment fraud victims are more likely to be male, white, and married, and to have higher socioeconomic status compared to the general US population, but little research examines what behaviors and mindsets differentiate them from other investors. A telephone survey was administered to 214 investment fraud victims and 813 general investors recruited using random digit dialing. Based on the opportunity model of predatory victimization, the aim was to identify differences in investment behaviors and psychological mindsets that may affect exposure to investment scams and make individuals more attractive and susceptible targets. In addition to being older and male, victims were more materialistic than general investors and were more frequent stock traders, and purchased more investments sold through unsolicited calls, emails, television advertisements, or "free lunch" seminars, but were less likely to invest based on a social network member's recommendation. As more retirees begin to take on managing their retirement assets, many may be tempted by unreasonable investment returns promised by unscrupulous brokers. Findings point to specific areas where investor education is needed to counteract poor investment decision-making and risky mindsets.

Original languageEnglish (US)
Pages (from-to)904-914
Number of pages11
JournalJournal of Consumer Research
Issue number5
StatePublished - Feb 1 2020

Bibliographical note

Funding Information:
Marguerite DeLiema ( is an assistant professor of research at University of Minnesota, Twin Cities, in the School of Social Work, Peters Hall 1404 Gortner Ave. St. Paul, MN 55108. Doug Shadel ( is the Washington State director of AARP, 18000 International Blvd. SeaTac, WA 98188. Karla Pak ( is a senior program specialist at AARP Washington, 18000 International Blvd. SeaTac, WA 98188. Please address correspondence to Marguerite DeLiema. The authors thank Kristin Keckeisen and Jodi Sakol from the Fraud Watch Network for funding this research, and Jennifer Sauer from AARP’s Research Department for overseeing all of the contracts for this project. Special thanks go to Dr. Laura Carstensen and her research lab at Stanford University for providing valuable feedback on survey design and measures, and Dr. Marsha Richins from the University of Missouri. Gary Mottola, Gerri Walsh, and Christine Kieffer from the FINRA Investor Education Foundation provided early input and background about prior investment fraud research. Melodye Keinman and Anna Mills from the National Telemarketing Victim Call Center, as well as Leeta Scott and Amy Nofziger from the Fraud Fighter Call Centers, assisted by locating known investment fraud victims to help inform survey measures. Kendrick Sadler from ARC Research led the fielding of the telephone survey. This study was funded by AARP’s Fraud Watch Network. Supplementary materials are included in the web appendix accompanying the online version of this article.

Publisher Copyright:
© 2019 The Author(s) 2019. Published by Oxford University Press on behalf of Journal of Consumer Research, Inc. All rights reserved.

Copyright 2020 Elsevier B.V., All rights reserved.


  • investment scam
  • materialism
  • opportunity model of predatory victimization
  • remote investing


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