The State Corporation Commission (SCC) urges Virginians to beware of opportunistic investment and other scams in the wake of Hurricane Florence.
“Scams often follow the headlines, and natural disasters are no exception,” said Ronald W. Thomas, director of the SCC’s Division of Securities and Retail Franchising. “While news coverage from Hurricane Florence has focused on the devastation and the tireless efforts of first responders and neighbors helping neighbors, we know from experience that financial predators often take advantage of disasters to peddle their schemes and profit from the misfortune of others.” Thomas urges Virginians to exercise extreme caution if confronted with unsolicited investment offers relating to Hurricane Florence.
Red flags of hurricane-related scams include unsolicited email, social media messages, crowdfunding pitches or telephone calls promoting investment pools or bonds to help storm victims, water-removal or purification technologies, electricity-generating devices and distressed real estate remediation programs. “Scam artists may linger long after the storm has passed to prey on victims who anticipate receiving large lump-sum insurance settlements for damaged property and other losses,” Thomas said.
Thomas offers the following tips to help investors avoid disaster-related scams:
- Delete unsolicited emails or social media messages and hang up on aggressive cold callers promoting hurricane-related investments, especially those from small companies touting unproven or new technologies or products.
- Use common sense. Claims of guaranteed returns or little or no investment risk are classic red flags for fraud. Every investment involves some degree of risk.
- Don’t be pressured to make rushed decisions about investments you don’t understand. Before deciding to invest, request written information that fully explains the investment.
- Do your homework. Contact the SCC’s Division of Securities and Retail Franchising to check that both the seller and investment are registered. If they are not, don’t invest. Contact information is available on the division’s website at www.scc.virginia.gov/srf/srf_contact.aspx.
- If you suspect you are the victim of fraud, report it to the Division of Securities and Retail Franchising immediately.
For more information, call the SCC’s Division of Securities and Retail Franchising in Richmond at (804) 371-9051 or toll-free (in Virginia) at 1-800-552-7945. You may also visit the division’s website at www.scc.virginia.gov/srf/ or the North American Securities Administrators Association’s website at www.nasaa.org/.
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