Finra issues Investor Alert warning about scams that offer Finra ‘guarantees’

Regulator scams, some using fake signatures of Finra executives, have been growing.

In a brazen effort to camouflage their fraud, financial scam artists are now claiming that Finra is guaranteeing their “opportunities.”

In an Investor Alert, the Financial Industry Regulatory Authority has warned investors to beware of scams in which con artists pose as regulators, including Finra, to make fraudulent investment pitches.

The regulator said that fraudsters recently used Finra’s name and logo in correspondence — such as falsifying the signature of Finra President and Chief Executive Officer Robert W. Cook — to trick investors into believing that Finra was guaranteeing an investment. The “opportunity,” of course, was a scam.

In its Investor Alert, Finra has included an infographic that details the tactics of an actual fraudulent letter used by scammers to build credibility.

“Financial fraudsters go to great lengths to appear legitimate, making it difficult for investors to recognize their ruses,” said Gerri Walsh, Finra’s senior vice president for investor education. “That’s why we are telling investors flat out that Finra does not guarantee investments, and that our officers play no role in facilitating investment opportunities. We want people to know that and to understand how they can verify who the real Finra is.”

In one fraud, e-mail pitches that purported to originate from Finra’s CEO portrayed the self-regulator as a “recognized financial manager of the International Monetary Fund,” notifying potential victims that “approval has been granted for the release and payment of your outstanding inheritance fund.” The scheme required the victim to fly to another country to claim the “inheritance,” Finra said in a release.

“In these imposter emails, the victim is asked to provide personal information, including a copy of their passport, which is a common tactic used in phishing scams,” Finra said.