Don't Take Nigerian Email Scammers' Offer Of An Auction-Rate Securities Settlement

When a Nigerian prince emails you promising $1.5 million from a deceased relative via a Swiss bank account, you know it’s a scam.

But how about the Financial Industry Regulatory Authority promising compensation from auction rate securities settlements?

FINRA is issuing this Alert to warn the public about a recent auction rate securities (ARS) “phishing” scam that promises compensation from ARS settlements in exchange for personal information. The email looks like it originated from FINRA—although it did not. It purports to inform the recipient of regulatory actions, including fines imposed by FINRA related to ARS, and states that the recipient is due $1.5 million regardless of the amount of their ARS investment or loss. The email then “phishes” for personal information including occupation, address and phone number.

That’s a cruel joke for those who lost in the sub-prime debacle.

FINRA phishing email

For the record, FINRA, the SEC and state securities regulators have announced final settlements with numerous brokerage firms relating to the sale of ARS, FINRA does not contact investors directly about settlements (it’s usually brokerage firms via hard mail, offering to repurchase ARS that the firm sold to them).

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