Leigh Davis-Schmidt Securities Examiner
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Transcript of Leigh Davis-Schmidt Securities Examiner
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Utah Division of Securities
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Utah Division of Securities
Leigh Davis-SchmidtSecurities Examiner
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Utah Division of Securities
The Securities Division enhances Utah’s business climate by protecting Utah’s investors through education, enforcement and fair regulation of Utah’s investment industry while fostering opportunities for capital formation.
Utah Division of Securities Mission:
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Utah Division of Securities
• Register Securities
• License Investment Professionals
• Conduct Compliance Examinations
• Educate Investors
• Investigate Investor Complaints
• Enforce State Securities Laws
How Do We Accomplish This?
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Utah Division of Securities
Top 10 Ways to Lose Your Money
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Utah Division of Securities
1. Ponzi Schemes2. Unlicensed Individuals Selling Securities3. Unregistered Investment Products4. Promissory Notes5. SENIOR INVESTMENT FRAUD6. High-Yield Investment Schemes7. Internet Fraud8. Affinity Fraud9. Variable Annuity Sales Practices10. Oil and Gas Schemes
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Utah Division of Securities
Why Is This Important To You?
EVERYONE IS A TARGET – ESPECIALLY SENIORS!
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Utah Division of Securities
Why Seniors Are Targeted
• Home To Answer The Phone Or The Door
• May Have Substantial Assets (e.g., Home, Retirement & Other Savings Accounts)
• Fear of Losing Financial Independence
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Utah Division of Securities
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Utah Division of Securities
Unsuitable Investments
• Not All Investments Are Appropriate For All People
• Get A 2nd Opinion From Other Financial Professionals
• Discuss With A Trusted Friend Or Relative
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Utah Division of Securities
Phony “Experts”
•“Senior Specialists”–Certified Elder Planning
Specialists (The National Registry of Elder Planning Advisors)
–Certified Senior Advisors–Senior Benefit Centers Network –Senior Financial Survival
Workshop
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Utah Division of Securities
• Use Introductory Seminars
• Offer Free Meal
• “Probe, Then Disturb, Then Enhance The Problem”
Annuity University
Wall Street Journal July 2, 2002
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Utah Division of Securities
• “You’re there to solve their problems, but you have to create those problems first – No Problem, No Sale”
• “Tell them you can protect their life savings from nursing-home and Medicare seizure of assets. They don’t know what that is, but it sounds scary…it’s about putting a pitchfork in their chest.”
• “Show them their finances are all screwed up so that they think Oh, no! I’ve done it all wrong – this will make you money”
Annuity University
Wall Street Journal July 2, 2002
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Utah Division of Securities
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Utah Division of Securities
Source mass mailing sent to Maryland life agents
To age 99
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Utah Division of Securities
Equity Index Annuity
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Utah Division of Securities
Other Schemes• Boiler-Room Brokers
– Cold Callers– High Pressure Sales
• Promissory Notes• Affinity Fraud• Off-Shore Trading Programs, Bank
Debentures, Prime Bank Instruments• Reload Scams
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Utah Division of Securities
Typical Boiler Room
• Locked Doors
• 157,000 Telephone Calls–50 Cold Callers –Stratton Oakmont - 13,000 Calls Per
Month To Utah Citizens
• Scam People Located Out Of State
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Utah Division of Securities
Investor’s Name
10% Per AnnumForeign Currency
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Utah Division of Securities
Affinity Fraud
• “I am also a member of (insert your religious, ethnic, professional or community-based organization)”
• Same “deal” was made with a prominent leader of your organization – “name dropping”
• Example: Tooele Community
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Utah Division of Securities
IMF Sponsored
High Yield Investment Program
Not A Solicitation
$600 Billion In 10 Days
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Utah Division of Securities
665% In 12 Months
Secret Currency
Beyond Reach of Government
Used By World’s Wealthy
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Utah Division of Securities
What Is A Reload Scam?
Once A Victim, Twice A Victim… • “I promise, you’ll make your money back
if only you’ll invest in…”• Promoter's Will Not Only Sell A Scam
To The Same Person Twice, They Share Their List of “Suckers” With Other Promoters
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Utah Division of Securities
So, What Can You Do?
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Utah Division of Securities
• Ask Questions – Be An Informed Investor
• Check Out Strangers Touting Strange Deals
• Watch Out For Salespeople Who– Prey On Your Fears – Try To Rush Your Decision
• Don’t Be Afraid To Hang Up The Phone
• Don’t Put All Of Your Eggs In One Basket
• Monitor Your Investments - Always Stay In Charge Of Your Money
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Utah Division of Securities
• Get Everything In Writing And Keep A Copy Of All Documents
• Risk No More Than You Can Afford To Lose
• If You Don’t Understand The Investment - Avoid It!!!
• Read And Understand Everything You Sign
• Don’t Let Fear or Embarrassment Keep You From Reporting Fraud Or Abuse
• Pass This Information On To Your Family, Your Friends, And Others
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Utah Division of Securities
REMEMBER:
Investigate EVERYTHING
Before You Invest
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Utah Division of Securities
Utah Division of Securities1-800-721-SAFE (7233)
(801) 530-6600www.securities.utah.gov