September 21, 2001
Contact: Lucas Hamilton
State Auditor warns of opportunistic investment scams following attacks on World Trade Center, Pentagon
In the wake of terrorist attacks in New York and near Washington, State Auditor John Morrison, Montana's Securities and Insurance Commissioner, warned investors to be on the lookout for opportunistic scams.
Cold-calling telephone salespeople, advertisements or Internet postings that tout commodities, exotic financial products or supposed anti-terrorist technologies should be a red flag for investors, Morrison said. Investors should be especially wary of enticements to send their money offshore to so-called "safe havens," he added.
"In times of tragedy, confusion, fear and uncertainty, there are always those who will attempt to prey on the investing public," Morrison said. "In the wake of last week's tragedies, investors should resist the temptation to make hasty decisions about their investments or finances. Our economy is the most diverse and productive in the world, and the United States is and will remain the world's financial capital."
Recalling that many con artists exploited fears associated with the Year 2000 computer bug to tout investments in precious metals, emergency preparedness scams and non-existent technology companies, Morrison urged investors to:
Hang up on aggressive cold callers promoting "safe" investments such as precious metals, oil, or gas, and ignore unsolicited e-mail or Internet chat room talk about small companies with new anti-terrorist technologies or products;
Don't give out personal financial or other information to strangers on the telephone;
Contact the Montana Securities Department at 1-800-332-6148 to check that both the seller and investment are licensed and registered. If they are not, they may be operating illegally;
Request written information that fully explains the investment, such as a prospectus or offering circular. The documentation should contain enough clear and accurate information to allow you or your financial adviser to evaluate and verify the particulars of the investment; and
Use common sense. Some things really are too good to be true. Get a professional, third party opinion when presented with investment opportunities that seem to offer unusually high returns in comparison to other investment options. Pie-in-the-sky promises often signal investment fraud.
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