SEC Warns of California Wildfire Investment Scams
Natural disasters, such as Hurricane Harvey, unfortunately give rise to investment scams promoting fake companies purportedly involved in relief efforts.
The recent California wildfires are no exception. The Securities and Exchange Commission (SEC), the federal regulatory agency charged with protecting investors, recently issued a warning about investment scams related to the ongoing California wildfires.
The SEC has issued a warning about California wildfire investment scams.
According to the SEC, these scams include the promotion of companies purportedly involved in the recovery efforts, and take many forms such as pump-and dumps, where misleading statements are used to artificially raise a stock’s price, and Ponzi schemes in which investors who invested earlier in the scheme are paid money obtained from newer investors. Theses scams are often promoted through social media and unsolicited emails.
If you have been presented with an opportunity to invest in a company related to the California wildfires, the SEC suggests you take certain steps to determine whether it is a scam, including:
- Asking whether the person promoting the investment is registered with the SEC or a state;
- Asking questions about the investment and verifying the answers you receive from an unbiased source; and
- Closely examining your finances before making any investment decisions.
As with any investment opportunity, it is important to remember that promises of large, quick returns with little to no risk are classic signs of fraud.
If you or someone you know has been a victim of a California wildfire investment scam, the Morgan & Morgan Business Trial Group may be able to help. Backed by the resources of the largest Plaintiff’s law firm in the country, the Business Trial Group’s securities litigation attorneys represent investors on a contingency-fee basis nationwide.
To speak with our knowledgeable, experienced securities attorneys about potential investment losses, please call us at (877) 599 3102 or fill out our free case review form.