By Darius Wood, Fall 2015 Student Intern
Today investors are being scammed by phone, email, or mail solicitations informing them that they have won cash, prizes, or other lottery winnings. Usually these scams are contingent on you taking some further action. For example, they may claim “all you have to do” to secure your winnings is to send a small amount of money as some type of processing fee.
The Federal Trade Commission (FTC) is a federal organization that monitors these types of schemes and they will pursue action against persons defrauding individuals. Recently, the FTC shut down a sweepstakes scam targeting seniors, where the fraudsters told them they have won 2 million or more and asked them to send $20-$30 by cash, check, or money order. FINRA has also recently launched a Securities Helpline for Seniors – HELPS to call in and report possible fraudulent incidents. These scams are nothing new and have been occurring for years, but the helpline has shown just how popular these scams are and how many seniors are being affected.
The best way to protect yourself from these types of scams is to decline to participate in them. Individuals should ignore these offers and never send any money for any of these offers to claim some prize or lottery winning that you just won – even if it is small amount.