Updated Investor Alert: SEC Warns of Government Impersonators

SEC staff is issuing this updated Investor Alert because they have seen a recent surge of complaints about a scheme where fraudsters posing as SEC employees call potential victims on the telephone and purport to offer them a large sum of money (in some cases, the amount of $450,000 is used) in return for depositing a smaller amount (for example, $1,500) into a specified account. Some of these solicitations may use the name of a legitimate company and refer prospective investors to an operating website. These solicitations, whether made by telephone, email, or other method, are fraudulent.

The SEC does not endorse investment offers, assist in the purchase or sale of securities, or participate in money transfers. Nor is the SEC affiliated with any sweepstakes, drawings, lotteries, or other types of events that feature prizes or winnings or cash windfalls.

SEC staff will not, for example, contact individuals by telephone or email for purposes of:

• seeking assistance with a fund transfer;
• forwarding investment offers to them;
• advising individuals that they own certain securities;
• telling investors that they are eligible to receive disbursements from an investor claims fund or class action settlement; or
• offering grants or other financial assistance (especially for an upfront fee).

SEC staff do not make these types of unsolicited communications, including emails or telephone calls, asking for detailed personal and financial information, such as shareholdings and Personal Identification Numbers (PINs). If you receive a telephone call or email from somebody claiming to be from the SEC (or another government agency), always verify the person’s identity. Use the SEC’s personnel locator, (202) 551-6000, to verify whether the caller is an SEC staff member and to speak with him or her directly. You also can ask whether the person calling you is employed by the SEC and request to speak with the staff member’s supervisor if there is such an employee. In addition, you can call the SEC at (800) SEC-0330 for general information. Our online Question Form is another way you can ask us about a solicitation.

If you have been contacted by somebody misrepresenting himself as an SEC staff member, please let us know by either calling us or submitting a Complaint Form. You may also report the incident to the Federal Bureau of Investigation (FBI) Internet Crime Complaint Center at www.ic3.gov.

It’s not hard to figure out who the real regulators are and how you can contact them. You’ll find a list of international securities regulators on the website of the International Organization of Securities Commissions (IOSCO) and a directory of state and provincial regulators in Canada, Mexico, and the U.S. on the website of the North American Securities Administrators Association (NASAA). If somebody encourages you to verify information about a deal with an entity that doesn't appear on these lists, you should be wary.

For additional tips on investing wisely and avoiding fraud, please visit the following web pages on the SEC’s website and Investor.gov:

Advance Fee Fraud Schemes
PAUSE List of Fictitious Governmental Agencies and International Organizations Associated with Soliciting Entities
Investor Alert: Investors Beware of Government Impersonators (October 2010)
Investor Alert: SEC Warns of Government Impersonators (April 2010)
Worthless Stock: How to Avoid Doubling Your Losses
Fake Seals and Phony Numbers: How Fraudsters Try to Look Legit
FTC Identity Theft Site
Online Scams that Impersonate the IRS
IRS Urges Caution about Internet Sites that Resemble the Official IRS Site

The Office of Investor Education and Advocacy has provided this information as a service to investors. It is neither a legal interpretation nor a statement of SEC policy. If you have questions concerning the meaning or application of a particular law or rule, please consult with an attorney who specializes in securities law.

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