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Enforcement
West Virginians are investing more into securities than ever before. For the
first time, investments outweigh bank deposits. We are investing into the stock
market and other securities faster than ever. The challenge for new investors is
separating the legitimate investments from the fraudulent business scheme; a
swindle; a scam.
Dishonest sales persons are calling with proposals for investing in everything
from motion pictures to worm farms ~ and are finding investors! It may seem
bizarre that there are actually victims of these "tips" or "secret markets", but
even the smallest investment seems to snowball until investors find themselves
with a life's savings involved and no way out of what was guaranteed to them as
a "safe investment that will double or triple your money in a short time."
These crooks may also put up money for radio and television advertisements.
Sometimes, at the end of a sales pitch you may hear a quickly spoken disclaimer
like: "Some investors can and do lose money." or "Past performance is not
indicative of future results." These disclaimers are a good warning and should
be heeded. The disclaimer may have unequal weight in the advertisement, but it
nonetheless warns potential investors and discloses risk.
Not only could an investor lose all the money involved in a fraudulent scheme,
but if investors chose to borrow money and an investment falls through, the
victim can lose the cash they invested and be obligated to repay the money
borrowed. Crooks have no problem with taking your life's savings!
Investigate Before You Invest
- The Central Registration Depository [CRD], is a computer database containing the
licensing and disciplinary histories on nearly 600,000 securities professionals
and 5,600 securities firms.
- The CRD, established in the early 1980's, is jointly owned by North American Securities Administrators Association [NASAA]
and the Financial Industry Regulatory Authority [FINRA].
- Disciplinary information in the CRD system includes customer complaints,
arbitrations and actions by state, industry and federal regulators and law
enforcement agencies. The majority of brokers are honest, ethical professionals,
but investors should always check with state or industry regulators before
investing. Investors should also check a broker's education and work history.
- To check the CRD record
of a broker or firm, or if you have any questions, contact the West Virginia
Securities Commission at 304.558.2257.
- When speaking with a securities salesperson or adviser, be sure to record
details of the recommendations received and the instructions given. Be sure to
keep the notes in your files.
- You may call the National Association of Securities Dealers' toll-free
disclosure hotline at 800.289.9999. You can also request a broker's record
online at www.finra.org.
- Before investing ask for written disclosure of documents. These documents should
show who the sponsor of the investment is, all the principal members of the
organization, the organization's track record, the details of what your
obligations are and the organization's business plan and financial statement (a
balance sheet, preferably audited).
- If an investment offer sounds "too good to be true" it probably is.
Call us at 888.368.9507 and ask if the offering is registered and if any
enforcement record can be provided.
If you have any questions, contact For further information, please contact the
West Virginia Securities Commission at 304.558.2257
Disclaimer
The West Virginia Securities Commission uses links to other Web sites for the
convenience of the user. Whenever you click on links provided, you are leaving
the West Virginia Securities Commission and entering an external site. The
Security Commission cannot attest to the accuracy of the information provided by
the external linked sites, nor does the Securities Commission endorse any
products or information obtained from these external sites.
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