TDCI Securities Division Issues Investor Advisory Alert Regarding Self-Directed IRAs and The Risk of Fraud
NASHVILLE – As part of its ongoing effort to raise investor awareness, the Tennessee Securities Division has issued an investor advisory alert regarding self-directed IRAs, an IRA held by a custodian that allows investment in a broader set of assets than most IRA custodians permit. The advisory explains in more detail what a self-directed IRA is, the associated risks of fraud and how consumers can avoid becoming victims to a scam.
“While all investments carry some degree of risk, self-directed IRAs have risks that differ from those involved with IRAs offered by registered broker-dealers and investment advisers,” Securities Division Assistant Commissioner Elizabeth Bowling said. “The risks of fraud can also be higher due to the types of “alternative assets” these custodians can allow investors to invest in – with limited protections provided by the custodian. We encourage all Tennessee consumers who are considering this investment type to review this advisory alert and become familiar with these types of IRAs..”
Before making any financial investment decisions, the Tennessee Securities Division recommends consumers ask questions, do their research, and contact the Securities Division at tn.gov/securities or 800-863-9117 for more information or if securities fraud is suspected.