NASAA launches First Nations investor outreach program

“Native Americans and First Nations populations historically have been underserved by investor education programs, in part, because of a lack of understanding of cultural sensitivity and frequent geographical isolation, which combine to put them at greater risk for affinity fraud,” said Jack Herstein, NASAA president and assistant director of the Nebraska Department of Banking & Finance, Bureau of Securities.

Herstein noted that its new outreach program not only addresses the specific needs of native communities, but that it offers specific training and instructions for outreach co-ordinators at the various state and provincial regulators, too. “In order to reach greater Native American and First Nation audiences with our investor education message, NASAA is encouraging its members to strengthen or establish partnerships with tribal leaders in their jurisdictions,” Herstein said.

NASAA notes that this effort to raise investor awareness and reduce the risk of investment fraud follows two recent billion-dollar settlements reached between Native American plaintiffs and the U.S. federal government, which may increase their appeal to fraud artists.

It notes that, in May, the U.S. Court of Appeals for the District of Columbia upheld a $3.4 billion settlement between the federal government and native tribes whose land trust royalties were mismanaged by the government. Separately, the U.S. Department of Justice announced a $1 billion settlement with 41 tribes over the mismanagement of assets held in trust by the feds.

“Con artists follow the headlines and know that billions of dollars are being prepared for distribution as a result of these settlements,” Herstein said. “As a result, Native Americans could become even greater targets for unscrupulous securities promoters.”