National Consumer Protection Week: Attorney General Porrino, Division of Consumer Affairs Warn Investors of Scams, Provide Resources to Educate Residents

As part of National Consumer Protection Week, which runs from March 5th to March 11th, the Division’s Bureau of Securities has outlined a number of steps which investors can take to protect themselves and their hard earned savings.

The Financial Fraud Research Center at Stanford University’s Center on Longevity estimates that between $40 and $50 billion is lost yearly to investment fraud.

“Investment fraud, especially frauds that targets senior citizens, is a huge concern for New Jersey residents and for our office,” said Attorney General Porrino. “The Bureau of Securities will aggressively pursue those who defraud others through investment scams, and we urge people to report their concerns to us and take every step they can to safeguard their money and their investments.”

“Investment scams tend to prey on the most vulnerable in our society, and can inflict devastating damage on people simply looking to safeguard their futures,” said Steve Lee, Director of the Division of Consumer Affairs. “Investors should always take the time to gather every bit of information they can on both the opportunity and the seller before handing over any money.”

Here are just some of the schemes and scams which the Bureau of Securities has identified as areas of serious risk for the investing public.

Unregistered products or unlicensed salespersons: If a product is labeled as “minimal risk” or “low risk,” beware. This type of language is often used by con artists and unregistered sellers to get people to buy into unregistered investments, which can quickly sour for the investor.

Ponzi schemes: Ponzi schemes are essentially a “house of cards” that will eventually topple over. Original investors are paid with the money of unsuspecting new investors, but once the rate of new investment slows, victims will not see returns on their investments, and in fact, their original investment will disappear.

Elder investment fraud: Senior citizens are a prominent target for scammers who seek to tap into large pools of money seniors set aside for retirement. Some scammers seeking to commit fraud often insert themselves into seniors’ lives, preying on their trust, and pressure them into investing in shaky propositions and unregistered investments. Beware of anyone suggesting a “can’t miss” investment and talk to a trusted financial adviser before giving anyone money.

Military families and veterans: Military families and veterans are often preyed upon by scammers posing as government officials or an investment agent dealing with military affairs. Often, these scams are designed to steal someone’s identity. Never commit to an investment or provide personal information over the phone or through an email link.

Before purchasing any investment, the Bureau of Securities reminds investors to ask the following questions:

The Bureau of Securities’ website contains a number of links in order to assist investors in making investment decisions:

Check Before You Invest Form: Make sure you ask the questions on this investment checklist before committing to any investment opportunity.

Frequently Asked Questions for Investors: Here are the answers to some frequently asked questions by investors.

More information about investor safety, filing complaints and the Bureau of Securities can be found here:

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