SEC Warns Investors of Fraudsters Posing as Regulators

The Securities and Exchange Commission (SEC) today warned investors to beware of imposter schemes in which con artists are posing as regulators to make fraudulent investment pitches.

The end goal of these ongoing impersonation attacks is to lure potential victims into investment scams using cold calls, cloned sites, fake social media profiles, and forged documents.

The top US watchdog said it has spotted scammers using the names of real SEC employees and email messages that falsely appear to be from the SEC to trick victims into sending the fraudsters money.

“We are aware that several individuals recently received phone calls or voicemail messages that appeared to be from an SEC phone number.  The calls and messages raised purported concerns about unauthorized transactions or other suspicious activity in the recipients’ checking or cryptocurrency accounts.  These phone calls and voicemail messages are in no way connected to the Securities and Exchange Commission,” the alert further reads.

This warning was issued by SEC’s Office of Investor Education and Advocacy (OIEA), an internal department tasked with helping retail investors protect themselves from securities fraud or abuse.

SEC’s warning follows a similar fraud alert issued by the Financial Industry Regulatory Authority (FINRA) regarding similar scams using phishing sites impersonating brokers and false registration documents.

Over the last few months, FINRA has repeatedly warned financial services firms of tricky new phishing campaigns that mimic a message from the nongovernmental organization.

Typically, the fraudsters use special software to make the message appear genuine. Recipients are often invited to click on a link that appears to take them to the watchdog’s website. Instead, they go to a false website that tries to steal sensitive information from those targeted, which can be used later without their knowledge to commit fraud.

Additionally, the watchdog pointed to its guidance on fake emails, websites, letters and phone calls on its website. The regulator said anyone in doubt about the authenticity of contact or receives such correspondences should contact the relevant authorities.

Furthermore, FINRA urged anyone who entered their password to change it immediately and notify the appropriate individuals in their firm of the incident. Further, it has provided details on how to identify spoof emails in a dedicated section on its website.