Posts Tagged ‘Investing’

Free Conference on Wise and Safe Investing Brings State and Federal Experts to York County

Maine Office of Securities Encourages Investors and Potential Investors to Register for Free Event – Including Practical Advice & Lunch

GARDINER, MAINE – Maine’s Office of Securities will host a free “Wise and Safe Investing Conference” on Friday, September 16th, from 8:30 a.m. – 12:30 p.m. at Village by the Sea Conference Center in Wells. Securities Administrator Judy Shaw is encouraging investors, particularly seniors and those approaching their retirement years, to register today by calling 1-877-926-8300.

This free investor protection event is part of the Department of Professional and Financial Regulation’s ongoing effort to provide information, resources and assistance to senior consumers and their advocates. The conference is part of a national investor protection initiative, “The Campaign for Wise and Safe Investing,” and funded by a grant from the non-profit Investor Protection Trust. The AARP Foundation is co-sponsoring the event and the Maine chapter of AARP is coordinating registration.

The Wise and Safe Investing Conference will feature federal and state experts from the U.S. Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), the AARP Foundation, and the Maine Office of Securities.

Panelists will provide practical advice on how to safeguard investments, avoid financial scams and identify unethical practices. In addition to the planned program, ample time will be available to address questions from attendees on other issues related to the securities industry, including how the current volatility in the national securities markets may affect small investors.

Registration for the conference is free and open to the public, but advance registration is required to confirm a seat. To register, call AARP/Maine toll-free at 1-877-926-8300. More information about the Wise and Safe Investing Conference is also available by contacting the Maine Office of Securities at 1-877-624-8551 or by visiting

The Office of Securities is part of the Maine Department of Professional and Financial Regulation.  It regulates the securities industry in Maine through a variety of activities, including licensing broker dealers and investment advisers; reviewing registration statements and exemption filings; investigating and prosecuting violations of the securities laws; conducting on-site compliance examinations of broker-dealers and investment advisers; and conducting investor education outreach programs.


Maine’s Office of Securities Releases Annual List of Top Investor Traps

Governor Encourages Consumers to Check Before Investing

AUGUSTA, MAINE — Maine’s Office of Securities is joining with the North American Securities Administrators Association (NASAA) in a public awareness campaign to highlight the most prevalent investor traps and scams of 2011. In announcing the collaborative effort, Administrator Judith Shaw explained that many investors have been under added pressure due to difficult economic conditions and fluctuations in the stock market.

“As investors seek to rebuild savings and restore retirement security, they need to resist the lure of sales pitches and become familiar with the most common fraudulent schemes,” Administrator Shaw commented. “Getting caught by an investment trap can make it much more difficult to get back on solid financial ground.”

Many of the investment traps identified by Maine’s Office of Securities and NASAA promise high returns to cash-strapped investors but provide little if any disclosure of risks and offer high commissions to aggressive salespersons. In some cases, the traps are outright scams.

Governor Paul R. LePage urged potential investors to gather appropriate information before investing. “As we work to strengthen Maine’s economy, it’s understandable that many investors are seeking to increase their income or overcome past losses. They should be cautious, however, about opportunities that promise unusually large returns. Maine state government can help investors by providing important licensing and registration information about investment products and the people offering them. The key is to check before you invest.”

 Top Investor Traps for 2011

Distressed Real Estate Schemes. Offerings of distressed real estate have been on the rise following the collapse of the real estate bubble. While many legitimate investment offerings are tied to real estate, investment pools targeting distressed real estate have become increasingly popular with con artists. Investments in properties that are bank-owned, in foreclosure, pending short sales or otherwise in distress inevitably carry substantial risks and should be evaluated carefully. Interests in real estate ventures must be registered with state securities regulators.

Energy Investments. Swindlers continue to trick investors by touting the promise of untapped oil and gas reserves and other sources of energy production. Even genuine oil and gas investments often bear a high degree of risk. Investors must realize the possibility that they could lose their total investment in legitimate ventures. Maine’s Office of Securities provided information and support this year in the case of a California man who took money from investors in Maine and other states promising returns on a wind power scheme that proved to be bogus.

Gold and Precious Metals. Higher precious metal prices and the promise of an ever-appreciating “tangible” asset have lured investors into a variety of scams. Recent schemes are variations on old themes: a promoter seeking capital to reopen a long dormant mine in exchange for a full refund plus interest and a stake in the mine. In another case, operators claimed to have special coins or nuggets that they can store or trade for investors in special markets for high profits and returns. There are no guarantees with gold or precious metals, even in legitimate markets. Earlier this year, silver’s value declined by 30 percent in a three-week period.

Promissory Notes. Investors seeking safety in uncertain economic conditions or those enticed by the promise of big returns through a private, informal loan arrangement may suffer deep losses investing in unregistered or fraudulent promissory notes. These notes give investors a false sense of security with promises or guarantees of fixed interest rates and safety of principal. Even legitimate notes carry some risk that the issuers may not be able to meet their obligations. Unregistered promissory notes are often covers for Ponzi schemes and other scams.

Securitized Life Settlement Contracts. Life settlement contracts are investments in the death benefits of insurance policies that insure the lives of unrelated third parties. Legitimate investments in life settlement contracts involve a high degree of risk, and investors may be responsible for routinely paying costly premiums for policies that insure people who outlive their life expectancies. Crooks are also embracing new schemes in this area to deceive investors.

Affinity Fraud. Marketing a fraudulent investment scheme to members of an identifiable group continues to be a highly successful and lucrative practice for Ponzi scheme operators and other fraudsters. A recent national study of Ponzi schemes over the past decade found that one in four were marketed to affinity groups to increase the scheme’s credibility and build the fraud. The most commonly exploited are the elderly or retired, religious groups, and ethnic groups.

Bogus or Exaggerated Credentials. State securities regulators have led the effort to prevent the misuse of credentials or designations intended to imply special expertise or training in advising senior citizens on financial matters. Now, state regulators are noting an increase in the use of other bogus credentials or exaggerated designations.

Mirror Trading. The securities market is constantly evolving to provide investors with new products, different platforms and a variety of choices. The latest evolution is “mirror trading,” which is promoted as an automated trading platform that ensures investors will participate in real-time transactions executed by a skilled and knowledgeable third party. Whenever the third party executes a trade in his or her account, the same trade is mechanically placed on behalf of the investor in the investor’s account. Investors should not be lulled into a false sense of security, and they need to objectively evaluate all new or popular investment platforms.

Private Placements. Investors should be aware that, even in the case of legitimate issuers, private placement offerings are highly illiquid, generally lack transparency and have little regulatory oversight.

Securities and Investment Advice Offered by Unlicensed Agents. State securities regulators have identified an increase in complaints regarding salespeople unlicensed as securities brokers or investment advisers giving investment advice or effecting securities transactions. Investors should insist to see a proper license from anyone offering investment opportunities.

“When it comes to investing, the first rule of thumb is to verify everything and everyone before parting with any money,” Shaw advised. “Information is an investor’s best defense against investment fraud, and Maine’s Office of Securities should be contacted whenever questions or concerns arise.”

Check Before You Invest: For more information about these top investor traps, or to check any investment professional or product, contact Maine’s Office of Securities toll-free at 1-877-624-8551. More information about the Office and its resources is available online at

The Office of Securities oversees the securities industry in Maine.  It is part of Maine’s Department of Professional and Financial Regulation, which encourages sound ethical business practices through the regulation of insurers, financial institutions, creditors, investment providers, and numerous professions and occupations for the purpose of protecting the citizens of Maine.  Consumers can learn more about the Department at


Maine’s Office of Securities Announces Improvements to

Individual Investors and Businesses Benefit from Enhancements to National Securities Industry Database

AUGUSTA, MAINE  —  Securities Administrator Judith Shaw announced this week that investors and businesses have an additional tool at their disposal to research the background and disciplinary history of licensed stock brokers and investment advisers.  The recently launched FINRA Disciplinary Actions Online database is a web-based searchable system that makes FINRA disciplinary actions accessible directly online.

 Administrator Shaw explained that the database benefits the public by increasing the transparency of and access to FINRA’s files on stock brokers and investment advisers who have been involved in disciplinary actions.  The public is now able to quickly search, download, print or read FINRA actions free of charge, seven days a week.  

 Users may search the system in a variety of ways, including by individual broker name and Central Registration Depository (CRD) number, or by firm name and CRD number, as well as by case number or action date (by date range).  Previously, the public had to contact FINRA to obtain copies of disciplinary actions.  The new database makes disciplinary action documents–including Letters of Acceptance, Waivers and Consent, and settlements–immediately available.

 “Investors are always encouraged to contact Maine’s Office of Securities to check the registration of investment opportunities, as well as the licensing and background of investment advisors,” Shaw commented.  “Enhancements to FINRA’s BrokerCheck® online system, however, make it easier than ever for investors to obtain additional information on their own.”  

Shaw said personal service is available from professional staff at the Office of Securities by calling toll-free 1-877-624-8551 (TTY: 888-577-6690).  Online disciplinary history through FINRA’s BrokerCheck system is available at  In 2010, members of the public used BrokerCheck to conduct 17.2 million reviews of broker or firm records.

 The Office of Securities oversees the securities industry in Maine.  It is part of the Department of Professional and Financial Regulation, which encourages sound ethical business practices through the regulation of insurers, financial institutions, creditors, investment providers, and numerous professions for the purpose of protecting the citizens of Maine.  More information about the Office and its resources is available at 

FINRA, the Financial Industry Regulatory Authority, is the largest non-governmental regulator for securities firms doing business in the US. For more information, visit

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