Securities Commission

Central Registration Depository

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 as little as two months."

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 investors and protects marketers.

Not only could an investor lose all the money involved, but if investors chose to use a margin account and an investment falls through, more money can be lost than was initially invested. Crooks have no problem with taking your life's savings!

"Security" could be considered a misnomer because it always involves some risk. Investors should be suspicious anytime "risk-free" is mentioned. "Security" also means no guarantee. Crooks will tell you anything to get your money ~ so beware! 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.

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 Financial Industry Regulatory Authority toll-free disclosure hotline at 800.289.9999. You can also request a broker's record online at www.finra.org

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.


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.

1900 Kanawha Boulevard East, Building 1, Room W-100, Charleston, WV 25305
Toll Free 877.982.9148   Phone 304.558.2261   Fax 304.558.5200


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