It’s been a banner year for white collar crime. Bernie Madoff, Allen Stanford, Marc Dreier, Raj Rajaratnam — the names go on.
With each case, investors or clients slapped their foreheads after the bust, wondering how warning signs were missed for so long.
So, how to avoid the next Ponzi scheme or sketchy money making operation?
Spare yourself the embarrassment — and big financial losses — by reading our compilation of the SEC’s steps to avoid scams.
Sure, it’s dry and the tips can be time-consuming in practice. But with even the SEC admitting it can blow it, you’d better do your homework. It might just save your bank account.
Here are ways to search SEC filings:
- Company or fund name, ticker symbol, CIK (Central Index Key), file number, state, country, or SIC (Standard Industrial Classification)
- Most recent filings
- Full text (past four years)
- Boolean and advanced searching, including addresses
- Key mutual fund disclosures
- Mutual fund voting records
- Mutual fund name, ticker, or SEC key (since Feb. 2006)
- Variable insurance products (since Feb. 2006)
- Confidential treatment orders
- Effectiveness notices
- SEC Central Index Key (CIK)
- Daily filings
- Researching Public Companies Through EDGAR: A Guide for Investors
SEC: Investor enthusiasm for the Internet has created tremendous financial opportunities in recent years -- for stock market fraudsters! That's because they often use the Internet to lure innocent investors into their scams. But you can survive stock market fraud and avoid becoming a victim if you follow these steps before you invest:
- Be sceptical: When you see an offer on the Internet, consider it a scam until you can prove it's legitimate through your own independent research.
- Consider the Source: Remember that the people touting a stock may be company insiders or paid promoters who stand to profit at your expense.
- Independently Verify Claims: Don't rely solely on claims by companies or promoters about new product developments, lucrative contracts, or the company's financial health.
- Beware of High Pressure Pitches: Watch out for promoters who pressure you to buy before you have an opportunity to fully research an offer.
- Research the Company: Always ask for -- and carefully read -- the company's prospectus and current financial statements.
- Confirm Registration: Check the SEC's database or your state securities regulator to determine if the company files reports or has registered a securities transaction.
SEC centre for Complaints and Enforcement Tips
There are several ways to file a complaint:
If you do not want to communicate electronically, either print and fill out a form or write us a letter. Our address is: SEC Complaint centre, 100 F Street NE, Washington, D.C. 20549-0213. You can also send a fax to 703-813-6965.
Whistleblower Protection: If you work for a publicly traded company and have been fired, demoted, suspended, threatened, harassed, or discriminated against for reporting a potential shareholder fraud to a supervisor, federal regulator, or member of Congress, then please contact OSHA's Office of the Whistleblower Protection Program right away. OSHA is the federal agency that investigates and handles these sorts of 'whistleblower' complaints.
What Information Should I Provide?
We can best respond to you if we receive accurate and complete information. Though you are not required to furnish any more information than you wish, critical information for us to completely evaluate your complaint or tip includes:
What Happens After I Send Information to the SEC?
We thoroughly review and evaluate your information so that we may refer it to the appropriate SEC office. The Office of Investor Education and Advocacy will handle certain general questions about the securities laws and complaints relating to financial professionals or a complainant's personal financial matters. The professionals in this office can counsel you regarding possible remedies and may, under appropriate circumstances, approach brokerage firms, advisers or other financial professional concerning matters you have raised.
Attorneys in the Division of Enforcement evaluate information and tips concerning violations of the federal securities laws. It is the general policy of the SEC to conduct its investigations on a confidential basis to preserve the integrity of its investigative process as well as to protect persons against whom unfounded charges may be made or where the SEC determines that enforcement action is not necessary or appropriate.
Subject to the provisions of the Freedom of Information Act, the SEC cannot disclose the existence or non-existence of an investigation and any information gathered unless made a matter of public record in proceedings brought before the SEC or in the courts. You can find information about public enforcement actions on our Web site.getting
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