Tuesday, January 29, 2008
Michael Stevenson, Director of Securities
PH (360) 902-8797 email@example.com
Lyn Peters, Director of Communications
PH (360) 902-8731 firstname.lastname@example.org
FOR IMMEDIATE RELEASE:
DFI Joins NASAA In Reminding Consumers That Investment Scams Often Lurk Behind Ominous Economic Forecasts
OLYMPIA – The Washington State Department of Financial Institutions (DFI) Director Scott Jarvis joins the North American Securities Administrators Association (NASAA) in reminding investors not to allow recent negative economic news and stock market volatility to lead them into high-risk speculative investments. Perpetrators of many fraudulent schemes use gloomy economic headlines to lure unsuspecting investors.
“Investment scam perpetrators stay current on economic news in order to seem more legitimate and believable to their victims,” Jarvis said. “These predators will use investor fears to promote illegitimate schemes with promises of high return with little to no risk that, in reality, often leave investors holding nothing but empty wallets and drained bank books.”
Phony investment scheme perpetrators promising high returns to make up for losses in retirement accounts often target investors nearing retirement.
“We’re concerned that in trying to build a more comfortable cushion for retirement, entire retirement savings built over a lifetime of working could be cleaned out,” Jarvis said. “Hasty decision making could potentially stamp out any chance of retirement for some consumers, or financially ruin a current retiree.”
DFI and NASAA encourage investors to:
- Guard against high-pressure sales pitches for unregistered securities and non-traditional investments including: foreign currency, oil and gas investments, exotic financial products, or offers to send their money offshore to so-called “safe havens.”
- Hang up on aggressive cold callers and delete unsolicited e-mail messages promoting investment opportunities with little or no risk.
- Request written information about any investment; carefully review it or ask your financial adviser to evaluate it BEFORE INVESTING.
- Use common sense. Get-rich-quick promises are usually signs of investment fraud. If it sounds too good to be true, it probably is!
- If you suspect you are the victim of a scam, report it to DFI's Securities Division. In addition to documenting your own case, your call could protect others from becoming victims.
- Contact DFI’s Securities Division or other state securities regulators to verify that both the seller and the investment are licensed and registered. If they aren’t, don’t invest.
- Be aware that legitimate financial professionals, if serving their client’s interests first, generally do not recommend changes to investment portfolios based on short term economic news and market volatility.
Investors, especially those nearing or in retirement, should be skeptical of any recommendation to liquidate a well structured, diversified investment portfolio to fund the purchase of an alternative investment product that may expose them to high commissions, high fees, excessive complexity, and undue risk.
www.dfi.wa.gov ▪ 360.902-8700 ▪ 877.746-4334 ▪ In Espaņol 888.976.4422
The Washington State Department of Financial Institutions regulates a variety of financial service providers such as banks, credit unions, mortgage brokers, consumer loan companies, payday lenders, and securities brokers and dealers. The department has won numerous awards for its financial literacy and outreach programs developed to protect consumers from financial fraud. In addition to posting information about licensees and administrative actions, the DFI’s Web site features consumer tips on a variety of financial fraud-related topics.
About the Division of Securities
www.dfi.wa.gov/sd/ ▪ 360.902.8700
The mission statement of the Securities Division is "To protect the investing public and promote confidence in the capital markets."
This mission is accomplished through a variety of regulatory and enforcement tools, including:
- Reviewing securities, franchises, and business opportunity offerings
- Licensing and examining Broker/Dealers, Investment Advisers, and their representatives
- Providing technical assistance to small business
- Responding to customer complaints, investigating and bringing appropriate administrative, civil and criminal cases and
- Providing information and investor education.
DFI’s Securities Division is a member of the North American Securities Administrators Association, the oldest international organization devoted to investor protection. NASAA’ s membership consists of the securities administrators in the 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, the provinces and territories of Canada, and Mexico.
Contact information for other regulators is available on the North American Securities Administrators (NASAA) Web site, www.nasaa.org.