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Seniors Targets for Top Ten Investment Scams

Thu, 04/26/2001 - 12:00am — Karen Stevenson
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The North American Securities Administrators Association (NASAA) released a new list of the "Top Ten Investment Scams", and warned the public that many of these scams are targeted directly at older adults. Deborah Bortner, president of NASAA and Washington State?s director of securities said that scammers are pitching their investments as low risk and high return to appeal to older Americans looking for a safe haven for their retirement funds. She said that the top problem on their list is unlicensed individuals, such as life insurance agents, selling securities. While most insurance agents do not violate the law, there is a growing problem with those that do. For instance, 11 of the 16 "cease and desist" orders issued by the Securities Division in Indiana in the first quarter of this year have targeted insurance agents who were selling securities without the proper license, most of whom were independent life insurance agents. A new scam on this year's list includes risky payphone and ATM investments, often sold by independent life insurance agents, and "callable" certificates of deposit sold to older Americans despite their 10- to 20-year maturities. These investments led to losses of about $76 million for 4,500 investors nationwide.

The North American Securities Administrators Association (NASAA) released a new list of the "Top Ten Investment Scams", and warned the public that many of these scams are targeted directly at older adults. Deborah Bortner, president of NASAA and Washington State?s director of securities said that scammers are pitching their investments as low risk and high return to appeal to older Americans looking for a safe haven for their retirement funds. She said that the top problem on their list is unlicensed individuals, such as life insurance agents, selling securities. While most insurance agents do not violate the law, there is a growing problem with those that do. For instance, 11 of the 16 "cease and desist" orders issued by the Securities Division in Indiana in the first quarter of this year have targeted insurance agents who were selling securities without the proper license, most of whom were independent life insurance agents. A new scam on this year's list includes risky payphone and ATM investments, often sold by independent life insurance agents, and "callable" certificates of deposit sold to older Americans despite their 10- to 20-year maturities. These investments led to losses of about $76 million for 4,500 investors nationwide.