SEC Issues Investor Alert on Investment Scams Related to Hurricane Ida



The SEC’s Office of Investor Education and Advocacy has issued an Investor Alert to help educate investors, including individuals who may receive lump sum payouts from insurance companies and others as a result of damage from Hurricane Ida, about investment scams.

Hurricanes, floods, oil spills, and other disasters often give rise to investment scams. These scams can take many forms, including promoters touting companies purportedly involved in cleanup and repair efforts, trading programs that falsely guarantee high returns, and classic Ponzi schemes where new investors’ money is used to pay money promised to earlier investors.

Some scams may be promoted through email and social media posts promising high returns for small, thinly-traded companies that supposedly will reap huge profits from recovery and cleanup efforts.   Fraudsters also may target individuals receiving compensation from insurance companies.  Individuals, including those receiving lump sum insurance payouts, should be extremely wary of potential investment scams related to Hurricane Ida.

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