For Immediate Release:
SAINT PAUL, MN – The Minnesota Department of Commerce announced the 2013 list of financial products, practices and services that are the greatest potential threats that trap unsuspecting investors. The 2013 list includes investment scams that also impact small business owners.
“Investors and small business owners must use caution as they wade through all of the new investment offers and services now allowed under the new rules required by the JOBS Act,” said Commerce Commissioner Mike Rothman. “The first steps investors should take to protect themselves are to fully research the companies, brokers, or advisors, and to check if the products themselves they are registered in Minnesota by the Commerce Department.”
The recent lifting of an 80-year-old ban on the advertising of private offerings, mandated by the JOBS Act, has the potential to lead to greater abuse by unscrupulous promoters. The implementation of the JOBS Act also has created opportunities for unregulated third parties to provide ancillary services. This is a reminder for investors that whether using a new crowdfunding portal or an accredited investor aggregator, it is important to do your due diligence and to understand the risks involved when using an unregulated third party. Investors are not alone in their potential to be scammed. Using a fraudulent portal means that both the business and the investor stand to lose.
The following list of the Top 10 financial products and practices that threaten to trap unwary investors and small business owners was compiled by the North American Securities Administrators Association (NASAA), of which the Commerce Department is a member:
New Investor Threats
New Small Business Threats
The Commerce Department urges investors to independently verify any investment opportunity as well as the background of the person and company offering the investment. The Department’s Securities Section can help verify those who sell securities or give investment advice, and about the products being offered are registered in Minnesota.
What We Do: Securities
The Minnesota Department of Commerce – Securities Section regulates the sale and registration of securities, franchises, subdivided lands, timeshares, and the delivery of financial advice. Additionally, the Securities Section protects consumers and investors and ensures that the expansion of Minnesota’s economy occurs in a prudent and responsible fashion by overseeing and enforcing the Minnesota Securities Laws by: registering brokerage firms, representatives of brokerage firms, investment adviser firms, franchises and timeshares; performing audits and examinations of persons who engage in activities we regulate, in order to improve compliance and prevent fraud; investigating and litigating on behalf of the State against those who commit violations of the Minnesota Securities and Franchise Laws; and providing public education and awareness, in order to facilitate investor protection.
The Commerce Department Can Help
Visit the Investor Education section on the Commerce website for more information on internet investment scams, investment traps, FAQs and more. If you believe you have been a victim of a fraudulent company or individual please contact the Commerce Department Securities Section at 651-539-1638 or email at firstname.lastname@example.org.