The decision to invest is a personal one that should not be taken lightly. Investing, when based on informed and sound decisions, can be a rewarding pursuit.  It can also be a devastating experience for those who are victimized by unscrupulous individuals who hatch and carry out fraudulent schemes that wipe out nest eggs and shatter people's lives.

Unfortunately, people lose their investments all the time - only because of fluctuations in the stock market, but as a result of fraud. In fact, the Federal Trade Commission reports that every year, Americans lose more than a billion dollars to investments that turn out to be fraudulent.

According to the North American Securities Administrators Association, a voluntary organization whose membership consists of  securities administrators in the 50 states, the District of Columbia, Puerto Rico, Canada and Mexico, the top 10 investment scams plaguing investors nationwide are:

• Ponzi schemes, in which swindlers promise high returns to investors. However, the only people who make money are the promoters who set these schemes into motion, using money from previous investors to pay new investors. Inevitably, the schemes collapse when the promoters are unable to find new investors.

• Senior fraud, where volatile stock markets, low interest rates, rising health care costs and increasing life expectancy leave senior investors vulnerable to investment fraud. Older investors are being targeted by increasingly complex investment scams involving unregistered securities, promissory notes, Ponzi schemes and viatical settlements, which are interests in life insurance policies of supposedly terminally ill people.

• Promissory notes, which are short-term debt instruments issued by little-known or, sometimes, nonexistent companies that promise high returns with little to no risk.

• Unscrupulous brokers who sell securities while cutting corners or resorting to outright fraud to fatten their wallets.

• Affinity frauds that use people's religious or ethnic backgrounds to gain their trust and steal their life savings.

• Insurance agents and other unlicensed securities sellers who sell fraudulent or high-risk investments, such as promissory notes, ATM and payphone investment contracts and viatical settlements, by promising high returns with little or no risk. While most independent insurance agents are honest professionals, some are lured by high commissions that come with these fraudulent and unauthorized sales.

• Prime bank schemes, in which scam artists promise investors triple-digit returns through access to the investment portfolios of the world's elite banks.

• Internet fraud, whereby scam artists use the Internet to find victims. They promote bogus offshore "prime-bank" investments and publicize pyramid schemes, among other things.

• Mutual funds business practices, which are being plagued by scandals throughout the industry. State and federal as well as mutual-fund firms have launched a series of inquiries into mutual fund trading policies.

• Variable annuities, in which some investors are misled with claims of guarenteed returns when variable annuity returns actually are vulnerable to the volatility of the stock market. Variable annuities, which offer tax deferral and death benefits among other incentives, come with strings attached and additional costs.

  Before you make any investment decision, you owe it to yourself to do your homework. That involves more than establishing a budget; identifying your long- and short-term goals; and assessing your tolerance for risk. It also requires that you get in touch with the New Jersey Division of Consumer Affairs' Bureau of Securities.

  The Bureau is responsible for enforcing the New Jersey Uniform Securities Act, which is designed to ensure honest and fair dealings in the securities industry and to protect investors from fraud. The Bureau registers broker-dealer firms; representatives of broker-dealer firms; investment advisers and financial planners. By contacting the Bureau, you can get important information about the investment professional or firm you're hiring, such as whether the person or firm is registered and whether that person or firm has a disciplinary history with the Bureau or other regulatory agency. To check with the Bureau of Securities regarding the financial professional's reputation, contact the Bureau at 973-504-3600 or write: New Jersey Division of Consumer Affairs, Bureau of Securities, P.O. Box 47029, Newark, N.J. 07101. You may also send an e-mail to the Bureau at: askconsumeraffairs@lps.state.nj.us.

  Investing can be a positive experience provided you are aware of the risks that come with it and take the proper precautions to protect yourself and your assets.

  Here are some more helpful investor tips by the Bureau and NASAA:

• Take the time to interview at least three investment professionals and obtain the registration and disciplinary history on each of the professionals before settling on one.

• Avoid doing business with financial professionals who have a record of disciplinary actions, negative arbitration decisions and/or civil litigation judgments.

• Call the Bureau to find out if the investment opportunity is registered for sale in New Jersey.

• Keep notes concerning phone conversations and meetings. Write down the date and time of each conversation and where meetings occurred.

• Keep greed in check. If the return on an investment sounds too good to be true, it probably is.

• Remember, con artists are usually extremely polite.

• Never assume that the investment is low-risk or guaranteed to deliver a certain return and do not rely on oral statements for assurance. Get all guarantees in writing and make sure you understand the information you are given.

• Once you've made an investment, carefully review your account statements. Make sure you know where your money is being held. General, you should receive account statements from the custodian of the securities as well as from your financial professional. Confirm that all transactions are ones you've authorized.

• Always stay in charge of your money. Make sure you fully read and understand your account statements. Your statement should reflect only the investing you authorized. If you find a discrepancy, raise the issue with your broker immediately or the branch manager who supervises the broker.

• Know how much you're paying in commissions and fees. Review your statements to check the performance of your investments for this information. If you cannot find this information on your statement, ask your financial professional to calculate these figures and send them to you. Do not work with a financial professional who is unwilling or who claims to be unable to provide this information to you.

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