TDCI Reminds Investors To Beware of Con Artists Looking to Profit from Fear and UncertaintyLearn To Spot the Red Flags of Con Artists’ Corona Investment Scams
NASHVILLE – In light of the ongoing developments related to the current coronavirus (COVID-19) situation and its impact on financial markets, the Tennessee Department of Commerce & Insurance’s (TDCI) Securities Division is reminding Tennessee investors to beware of con artists who are seeking to capitalize on fear and uncertainty.
“We know con artists are opportunistic and use current events to cloak their schemes with an air of immediacy and legitimacy. Never make an investment decision without understanding what you are investing in, who you are doing business with, where your money is going, how it will be used, and how you can get it back,” said TDCI Commissioner Hodgen Mainda. “Always ask if the salesperson and the security are registered with their state or provincial securities regulator.”
TDCI Assistant Commissioner Elizabeth Bowling, who oversees TDCI’s Securities Division, said investors should be on the lookout for scam artists trying to use the market downturn and the coronavirus to scare investors into so-called “safer, guaranteed investments.”
“If you have concerns about your retirement accounts or investments, talk to your financial professional,” Bowling said. “Avoid making decisions based on panic or fear.”
To help investors identify common telltale signs of possible investment fraud, TDCI has provided three questions to ask before making a new investment.
- Is the investment being offered with a guaranteed high return with little or no risk? All investments carry risk that you may potentially lose some or all of your money. Anyone who says their investment offer has no risk is lying. No one can guarantee an investment return.
- Is there a sense of urgency or limited availability surrounding the investment? If the offer is legitimate, it will be there later. If someone offers you a “can’t miss” investment opportunity and puts you on the spot, don’t be afraid to walk away.
- Is the person offering the investment, and is the investment itself, properly licensed or registered? For the same reasons you wouldn’t go to an unlicensed doctor or dentist, you should avoid unregistered investment salespeople and their products.
Consumers who suspect they might be a victim of securities or insurance fraud should contact the Tennessee Securities Division – Financial Services Investigations Unit at (615) 741-5900. To file a complaint online, visit us here.
Questions about a broker? Research the background and experience of financial brokers, advisers and firms at https://brokercheck.finra.org/
For the latest updates about how Tennessee is prepared for an outbreak of coronavirus (COVID-19) visit: https://www.tn.gov/health/cedep/ncov