February 13, 2025

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How to Counteract Pressure to Invest Quickly: High-pressure Tactics to Bypass Proper Due Diligence

Investing is a major financial decision that requires careful thought, analysis, and time. However, some investment opportunities come with high-pressure tactics designed to rush decisions and prevent proper due diligence. These tactics often involve urgent calls to action, limited-time offers, or fear-inducing narratives to sway individuals into making hasty commitments. The consequences of yielding to such pressure can be devastating, ranging from financial losses to legal complications. Understanding how to identify and counter these tactics is crucial for safeguarding your financial well-being.

Pressure to Invest Quickly: High-pressure tactics to bypass proper due diligence often hinge on creating a sense of urgency. Scenarios such as “This offer is only available today!” or “Others are lining up for this opportunity!” are typical. These messages aim to capitalize on emotions, especially fear of missing out (FOMO) or the desire to secure an exclusive deal. While these tactics may sound compelling, they are often red flags indicating the need for caution. A legitimate investment opportunity will provide ample time for review and inquiries.

Recognizing the Red Flags

To counter high-pressure tactics, the first step is recognizing them. Common signs include:

  • Limited-time offers with unreasonably short deadlines.
  • Refusal to provide comprehensive documentation.
  • Avoidance of answering detailed questions about risks or returns.
  • Statements claiming “too good to be true” returns.

By identifying these red flags, you can pause and evaluate the situation objectively rather than succumbing to emotional pressure.

Steps to Counter High-Pressure Tactics

  1. Take a Step Back
    When faced with urgency, take a moment to pause. Let the promoter know you need time to evaluate the offer. Legitimate opportunities will remain open for a reasonable period, and any pushback on this request should reinforce your skepticism.
  2. Request Full Documentation
    Insist on receiving all available documents related to the investment, including contracts, financial statements, and risk disclosures. If these are not provided or appear overly complex and vague, it’s a signal to step away.
  3. Consult with Experts
    Seek advice from financial advisors, lawyers, or industry experts who can assess the legitimacy and viability of the opportunity. Their insights can help you make an informed decision.
  4. Do Your Own Research
    Independent research is vital. Look for online reviews, past performance data, and regulatory filings if applicable. Verify claims made by the promoter with reliable third-party sources.
  5. Trust Your Instincts
    If something feels off or too rushed, trust your gut. Scams often rely on individuals ignoring their better judgment due to pressure or excitement.

Why Due Diligence Matters

Due diligence can increase understanding of an investment’s risks, potential returns, and alignment with your financial goals. It also provides a buffer against fraud and ill-informed decisions. Skipping this step increases vulnerability to financial scams and poor investment outcomes.

Conclusion

High-pressure tactics are a common ploy to bypass proper due diligence. By recognizing red flags, slowing down the process, and seeking expert guidance, you can protect yourself from making rushed decisions that could lead to significant financial harm. Remember, legitimate investments respect your need for thorough evaluation—your financial future deserves nothing less.

By Marilee Crockett

Marilee is a distinguished financial executive with extensive experience in finance, compliance, and due diligence services across various sectors. As the Chief Investment Officer at Brilliant Minds Group Exit Club (BMG Exit Club), she brings a wealth of expertise in fund compliance, regulatory reporting, and risk management to help ensure comprehensive due diligence processes.

Marilee is the Founder and Director of Crockett Investigations, a licensed private investigations firm specializing in investment KYC/AML and enhanced due diligence for startups, General Partners, and Limited Partners. During her career, she has been instrumental in facilitating thousands of Regulation D 506(b) investments, collaborating with strategic partners, General Partners, Limited Partners, including private clients who are high-net-worth individuals (HNWIs) and ultra-high-net-worth individuals (UHNWIs).

Concurrent to her role at BMG Exit Club, Marilee is a special manager and U.S.-based agent at Crockett Global Consulting for international Venture Capitalists investing in U.S. startups. 

Marilee’s career includes significant experience in the financial sector, having conducted due diligence, AML/KYC, and international financial crime investigations for two of the United States’ largest banks. She also served as President of Crockett Energy Consulting in Dallas, Texas, contributing to the development of the Environment Education Center in Plano, Texas.

Marilee holds Bachelor’s and Master’s degrees from Brigham Young University in Provo, Utah. Her multifaceted experience and commitment to excellence position her as a pivotal leader at BMG Exit Club, where she continues to drive innovation and uphold the highest standards in investment management.

Marilee has lived in eight states and two foreign countries. She currently resides in the Salt Lake City metro area. In her personal time, Marilee works in the film industry, plays the violin, and enjoys spending time with her family. She is the mother of seven grown children and has eleven grandchildren.