The Wisconsin Department of Financial Institutions’ Division of Securities Offers Tips for Avoiding Investment Fraud in Recognition of World Elder Abuse Awareness Day
Seniors have worked hard all their lives to build up a safe nest egg that they can depend on through retirement. Unfortunately, this makes them prime targets for fraudsters who try to scare them into believing that their retirement savings is in peril due to volatile financial markets or global conflicts. Fraudsters take advantage of current events and financial fears by trying to sell seniors “guaranteed” or “safe” investments, or by tricking them into giving out personal information or passwords. Unfortunately, these scam investments are far from safe, and once a senior is scammed it is extremely unlikely that any money will be recovered.
Regardless of what’s happening in the world, the Wisconsin Department of Financial Institutions’ Division of Securities cautions all investors to be aware of the increasing frequency and sophistication of financial scams. Consider these tips for protecting your financial investments:
Avoiding investment fraud
- Be wary of investment opportunities linked to the headlines. Delete unsolicited emails and social media messages offering investments with limited or no risk, or with significant or guaranteed returns.
- Beware of bitcoin and cryptocurrency investments advertised as “safe” or “guaranteed income.” These are volatile, high-risk assets that are not regulated by any government agency. They are also more susceptible to fraud and hacking than traditional investments.
- Do your homework. Ask questions! Understand what you are investing in.
- Find out if the person selling the investment is registered. Use BrokerCheck (finra.org) to do a quick online background check on a salesperson, or call us at the Division of Securities: (608) 266-2139.
Safeguarding personal financial information
- Be cautious about sharing personal financial information, such as your bank account number, Social Security number or credit card number. Limit the personal information you share online.
- Keep operating systems on your phone and computer up to date.
- Create strong passwords for your online accounts and, if possible, use two methods of verification when logging in.
- Check your account statements and credit reports regularly.
- Do not click on links in texts or emails from people you don’t know.
Visit the Wisconsin Department of Financial Institutions’ Division of Securities’ Investor Education (wdfi.org/fi/securities/investor_education) webpages for more information on investment products and professionals, resources for seniors, and tips for avoiding investment fraud. You can also download our new Wisconsin Investor Guide (wdfi.org/_resources/indexed/site/fi/securities/2022WisconsinInvestorGuide.pdf), an easy-to-use resource packed with strategies for investing wisely and avoiding financial fraud.
If you believe you are a victim of investment fraud, please report it right away to the Wisconsin Department of Financial Institutions’ Division of Securities by emailing DFISecurities@dfi.wisconsin.gov or calling (608) 266-2139. Do not be embarrassed—many intelligent, wealthy and famous people have been victimized (just think of the Madoff case), and scam artists are good at what they do. The sooner a scam is reported, the better the chance it can be shut down while there is still money to repay victims and prevent the scammer from defrauding others. They work closely with local law enforcement and other state and federal agencies, including the Office of the Wisconsin Commissioner of Insurance (OCI), the FBI and U.S. Securities & Exchange Commission. If they cannot handle a matter, they take steps to direct you to the appropriate agency to review your case.
June 15 is World Elder Abuse Awareness Day. Elder Abuse encompasses a range of behaviors including physical abuse, emotional abuse, sexual abuse, neglect, unreasonable confinement or restraint, and financial exploitation. In 2021, Dane County Adult Protective Services (APS) investigated 378 reports of elder abuse, 71% of those cases were substantiated. Of those reports, financial exploitation was the highest category, accounting for 41.3% of the investigations. The second highest category was self-neglect, at 28.2%. In 2021 in Dane County alone, victims of financial exploitation lost over $2.4 million. The Wisconsin Department of Financial Institutions’ Division of Securities opened approximately 103 cases in 2021 and issued 22 orders against 33 perpetrators of investment fraud, with over $500,000 in restitution and disgorgement ordered returned to investors. Senior victims can be found in at least one-third of those cases.
Financial exploitation of seniors is a growing problem in Wisconsin, and we all need to work together to stop it. That is why, partnered with our colleagues at the Dane County APS, the Elder Rights Project at Legal Action of Wisconsin, the Wisconsin Department of Justice (DOJ), and the Wisconsin Department of Health Services (DHS), we recognize the importance of World Elder Abuse Awareness Day and share these important tips with you.
