FBI, SEC warn public about fake brokers and advisers

The FBI and the Securities and Exchange Commission have teamed up to warn investors to beware of fraudsters who try to swindle them by pretending to be registered brokers or investment advisers.

An investor alert issued by the FBI’s Criminal Investigative Division and the SEC’s Office of Investor Education and Advocacy says fraudsters may falsely claim to be registered with the SEC, the Financial Industry Regulatory Authority Inc. or a state securities regulator.

“Some may even impersonate investment professionals who actually are registered with these organizations,” according to the investor alert. “Fraudsters may misappropriate the name, address, registration number, logo, photo or website likeness of a currently or previously registered firm or investment professional.”

The agencies cited some tactics popular with fraudsters:

Spoofed websites. Fraudsters may set up websites with URLs or names that resemble those of registered firms.

Fake profiles on social media. Fraudsters may set up profiles on social media platforms that impersonate registered investment professionals and then message investors.

Cold calling. Fraudsters may call investors and offer to invest their money while claiming to work for registered firms, using technology that makes it seem as if they’re calling from the firm.

Misrepresenting or falsifying documents. Fraudsters may claim to investors that the firm was registered with the SEC or impersonate a registered investment adviser by generating a fake version of a public report.

The alert says investor should be alert for such red flags as guarantees of high investment returns and unsolicited offers from people they don’t know. When it comes to paying, the alert said investors should be worried if they’re asked to pay by credit card, since advisory firms don’t usually use credit card payments, or with a digital asset wallet or cryptocurrencies.

[More: Internet scams are top threat to investors, NASAA says]

The post FBI, SEC warn public about fake brokers and advisers appeared first on InvestmentNews.

Andrew is half-human, half-gamer. He’s also a science fiction author writing for BleeBot.

Andrew Vincent
Andrew is half-human, half-gamer. He's also a science fiction author writing for BleeBot.
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