Securities regulators are warning investors about the risk of Sandy-related investment scams, in the wake of this week’s hurricane.
The North American Securities Administrators Association (NASAA) Wednesday warned investors to beware of opportunistic “Sandy scams”. In particular, NASAA warns that cold-calling telephone salespeople, advertisements, and Internet postings that promote investment pools or bonds to help storm victims, or tout water-removal or purification technologies, electricity-generating devices and distressed real estate remediation programs should be a red flag for investors.
“Unfortunately, we know from experience that disasters bring out the worst in people, especially those seeking to profit from the misfortunes of others. Potential investors should be very cautious if approached with unsolicited Sandy-related investment offers,” said Heath Abshure, NASAA president and Arkansas Securities Commissioner.
The group also says that investors also should be aware of the rush of charity solicitations that follow a highly publicized natural disaster or other crises, which can include frauds too.
“There will be fraudulent charity solicitations,” Abshure said. “Some will be looking for your money; some will be attempting to steal your credit card information for identity theft. As with any charitable contribution, people wanting to help with relief efforts following Sandy should send contributions to only those charities with an established track record.”
Abshure also warned that fake victims may attempt to use social media to dupe well-intentioned donors. “Do not donate to unknown individuals that purport to need aid that post on Facebook, Craigslist, Twitter or other social media sites. These are likely to be fraudsters, who may not have even been a resident of the United States much less a victim of the storm,” he said.