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Funding Secured to Aid Scam Victims

March 7, 2013

HELENA, Mont. – Governor Steve Bullock has signed into law a bill providing ongoing funding for the Securities Restitution Assistance Fund, a pool of money that helps victims of investment fraud get back on their feet. The legislation sponsored by Rep. Duane Ankney (R-Colstrip) at the request of Montana Securities Commissioner Monica Lindeen, helps victims of Ponzi schemes, pyramid schemes and other investment fraud recover a portion of what they lost.

"Seniors' retirement accounts and savings make them prime targets for investment scams," said Lindeen. "If a senior falls victim to an investment scam, they may never get their money back. For many Montanans, this restitution fund is the only way they can get back on their feet."

"I am pleased to sign this bill," Gov. Bullock said. "When we put the politics aside and focus on doing what is best for Montana citizens, the results are always worthwhile."

It is estimated that 80 percent of households in Montana have some kind of investment account, from mutual funds to retirement and 401k accounts. Montana's 2011 Legislature created the Restitution Fund to help Montanans who fall victim to investment fraud.

The 2011 legislation allowed Lindeen to seek court-ordered and voluntary contributions to the fund from investment firms and brokers. Since then, Lindeen's office has raised more than $200,000 for the fund.

During the last two years, however, Lindeen's office has ordered more than $35 million in restitution to Montana victims. Nearly $15 million of that restitution will likely never be paid. Often, money stolen in investment scams is spent or lost, leaving victims little hope of getting their money back.

The legislation signed today allows Lindeen's office to direct a small fraction of fees already collected from investment firms to the fund. As a result, the fund is expected to collect $272,000 per year to provide direct assistance to victims of investment fraud.

People who have been victims of investment fraud can apply for assistance to the fund from the Commissioner's website, csi.mt.gov. Eligible victims can receive 25 percent of what they lost or $25,000, whichever is less. If the balance of the restitution fund is low, additional restrictions apply. For more information, visit csi.mt.gov or call the Commissioner's hotline at 800-332-6148.