The Better Business Bureau warns investors to beware of bogus investment-related "regulatory" Web sites being used by scam artists to lend legitimacy to their ploys. Some operate through fake Internet pages set up to look like the official Web sites of regulatory agencies and compliance commissions and others contact their victims through the mail or by phone. In each case, the investor is led to believe that they are dealing with a legitimate domestic or international regulator who is vouching for a particular investment business, stock or broker.
Names of imitation "regulators" that have been reported to the North American Securities Administrators Association (NASAA) include the Regulatory Compliance Commission, the International Regulatory Commission, the International Compliance Commission, the International Shareholder Protection Division and the International Exchange Regulatory Commission. None of these so-called agencies had any relation to real regulatory agencies or organizations.
The BBB and NASAA offer the following red flags that indicate you are dealing with a fake "regulator":
- Other regulators have never heard of them, and there are no references to them on any other regulatory Web sites.
- The "regulator" claims to represent an official federal government agency, but its Internet site does not end in ".gov." To check on the legitimacy of a securities "regulator," visit the International Organization of Securities Commissions site (www.isoco.org). If they are not listed, they probably are bogus.
- The "regulator" endorses or offers approval for an investment opportunity, stock or company. Legitimate regulators do not promote investment deals; they stick to enforcing securities laws and ensuring fair dealing.
- They demand that you pay a fee to "release restricted shares." This is a common ploy to steal your savings, and a twist on the age-old advance fee loan scam.
- You cannot find any information about the "regulator" when you do an Internet search. Any legitimate regulator should generate hundreds of entries in any Internet search engines.
If you are in doubt about the legitimacy of a securities regulator, compliance commission or investment firm, contact your Better Business Bureau, state securities agency or NASAA at www.nasaa.org.