Real Estate Investor Magazine South Africa April 2014 | Page 21

UPFRONT
JORDAN BELFORT’S TIPS ON HOW SPOT A
BAD INVESTMENT AND CON ARTISTS
too
1 Bewareitof an offer that soundstrue,good to be
true. If sounds too good to be
it probably
isn’t true
Walk away if the investment is touted as being
available for a few select people
Walk away if there is a lack of transparency on
the details of the asset
Walk away if those punting the product claim
to have the proprietary formula for the product
they are selling

2
3
4

is worth over a R1 billion a year and says that some
international gurus have made a fortune here in South
Africa. Canadian entrepreneur JT Foxx has grown his
coaching business here in South Africa to over R100
million in less than a year. Clearly these gurus have
discovered an untapped market locally, but the question
is: are the delegates getting the value and the results
they have been promised?

Will the guru’s system produce results?
The problem with many real estate gurus is that they
don’t make money from investing in real estate, but
rather from selling overpriced real estate training,
courses and products.
Many also make money through selling investment
properties or investment schemes offered on an
exclusive basis. The problem is that the guru is paid
commission upfront for the sale, while the follower has
to wait years for any reasonable return.
Jordan Belfort, American motivational speaker
who spoke at the Success Summit in South Africa
recently, said he lost more than $200 000 investing in a
mining scheme in South Africa offered as an exclusive
investment. He says it can be difficult to assess an
investment even if you do a proper due diligence.
Warren Buffett is also highly critical of active
investing when it is not necessar y, saying that
institutions and individuals are constantly being
urged to buy and sell assets by those who profit from
giving advice or effecting the transactions. He says
the transactional costs are huge and many of the
www.reimag.co.za

Jordan Belfort
investments are devoid of any real benefit for the
investor, advising investors to “always keep your costs
to a minimum and invest as you would in a farm”.
Unfortunately, not enough people are skeptical of
‘gurus’ who promise rags-to-riches results, or promote
their training as the ‘silver bullet’ that will make
delegates and followers millionaires, or enable them
to build massive property portfolios with little or no
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