OLYMPIA – The Washington State Department of Financial Institutions (DFI) announced today that it is participating in an international enforcement task force organized by the North American Securities Administrators Association (NASAA) to investigate fraudsters looking to capitalize during the novel coronavirus COVID-19 pandemic.
“We are proud to join our colleagues in NASAA’s COVID-19 Enforcement Task Force,” DFI Director Charlie Clark said. “Investment schemes related to COVID-19 are a significant threat to investors in Washington, and fraudsters need to know our agency is dedicated to effectively protecting investors from COVID-19 investment fraud.”
Washington’s DFI is a member of NASAA, the membership organization of state and provincial securities regulators in the United States, Canada and Mexico. The task force consists of state and provincial securities regulators and was formed to identify and stop potential threats to investors stemming from the COVID-19 pandemic. Task force members are using online investigative techniques to identify websites and social media posts that may be offering or promoting fraudulent offerings, investment frauds, and unregistered regulated activities.
To assist in protecting investors from COVID-19 investment scams, DFI also encourages public reporting of suspected fraudulent COVID-19 investment offers. Investors who see or suspect they fell victim to COVID-19 related investment scams can contact the agency toll-free at 877-RING-DFI (746-4334), locally at 360-902-8730 or via email at firstname.lastname@example.org.
“Reporting suspicious COVID-19 related investment offers is important to help DFI investigate and prosecute illegal activities and protect our citizens from falling victim to a financial fraud in these unprecedented times,” DFI Director of Securities Bill Beatty said.
A critical component of fighting fraud is investor awareness. To help investors identify common telltale signs of possible investment fraud, DFI suggests three questions to ask before making a new investment:
- Is the investment being offered with a guaranteed high return with little or no risk? All investments carry risk that you may potentially lose some or all of your money. Anyone who says their investment offer has no risk is lying. No one can guarantee an investment return.
- Is there a sense of urgency or limited availability of detailed information surrounding the investment? If someone offers you a “can’t miss” investment opportunity and pressures you to invest right now, don’t be afraid to walk away.
- Is the person offering the investment, and the investment itself, properly licensed or registered? For the same reasons you wouldn’t go to an unlicensed doctor or dentist, you should avoid unregistered investment salespeople and their products.
“Make sure you have all the facts before you hand your money over to someone else to invest,” Beatty added.
DFI offers investor education information at https://dfi.wa.gov/financial-education/information/investing and more on how to identify scams and frauds at https://dfi.wa.gov/financial-education/information/financial-scams-and-fraud.