Hurricane-related Investment Scams

We've seen a large number of investment scams springing out of the recent hurricanes and events in the Gulf of Mexico. Some of them are circulated through faxes and "spam" e-mails, promising unbelievably high returns for small, thinly traded companies that will supposedly benefit hugely from recovery and cleanup efforts. It is very important to be aware that scamsters tell plausible lies to get you to invest. Promises of fast and high profits, with little or no risk, are classic red flags of fraud. Remember - if it sounds too good to be true, it usually is! For more information, read the SEC's brochure, "Internet Fraud: How to Avoid Investment Scams," or the tip sheet, "Stock Market Fraud: 'Survivor' Check List." 

Before making any investment — online or offline — it pays to do your own research to make sure the company exists, that its products are genuine and its claims legitimate. If a company is registered with the SEC, you can find financial statements on the SEC's website, filed electronically through "EDGAR." If a company is not registered with the SEC, check with your state securities regulator before investing. 

For an example of what a hurricane-related internet fraud might look like, please click here.