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Securities News Releases
Wednesday, July 20, 2005
Contact: Stacie Temple, (573) 526-5076
Contact: Erin Cutraro, (573) 526-0949
Carnahan Urges Missourians to Beware of Recovery Scams
Scam Artists Target Investors Who Lost Money Previously
Jefferson City, Missouri -- Secretary of State Robin Carnahan urges Missourians to be aware of "recovery" or "reload" scams that prey on investors who have already lost money in a previous investment scam.
Recovery scams target victims by posing as a company or a regulatory agency that can help the victim "recover" his/her loss. They convince the investor that they can get their money back for them if the investor will pay an upfront fee. Unfortunately, the victim not only doesn't get their original investment back, but ends up losing even more money.
"Investors should be very skeptical of unsolicited calls from unknown individuals asking for money and should not let the caller pressure them into making a hurried decision," said Carnahan. "In addition, authentic regulators do not charge consumers for their services. Investors who believe they are victims of fraudulent investment activities should contact our office for assistance," she added.
Last week, the Commissioner of Securities, David B. Cosgrove, issued a cease and desist order against "Securities Compliance Department," a recovery scam, with a false Kansas City, Missouri address and a convincing web site.
The "Securities Compliance Department" called an investor and told him that they were in charge of getting his money back from a prior investment scam. They advised him that they had his money and would send it to him after he paid an upfront fee of $20,000. Instead of sending the money, the investor contacted the Missouri Securities Division.
"Purchasing investments by telephone from unknown people may make it difficult or impossible to get money back if the transaction turns out to be fraudulent. Anyone contacted by telephone regarding any investment should ask for written information about the investment and the salesperson and notify the Securities Division immediately if the caller is unable or refuses to provide that information," said Cosgrove.
For more information regarding investments and fraud protection, or for information regarding a company or representative, visit the Secretary of State's web site at www.sos.mo.gov/securities or call the toll free investor hotline at 1-800-721-7996.