Joint Initiative Includes Aggressive Enforcement, Targeted Examinations, and Investor Education and Outreach Programs
Washington, D.C. (May 8, 2006) – Securities and Exchange Commission Chairman Christopher Cox and North American Securities Administrators Association President Patricia D. Struck today announced a joint national initiative designed to protect seniors from investment fraud and sales of unsuitable securities.
The initiative, which builds upon the success of cooperative efforts between the SEC and Florida securities regulators, in conjunction with the NASD, to crack down on senior investment fraud, will have several components, including targeted examinations to detect abusive sales tactics aimed at seniors, aggressive enforcement of the securities laws in cases of fraud against seniors, and active investor education and outreach.
“Another American baby boomer will turn 60 every eight seconds for the next 20 years,” said Chairman Cox. “As the nation’s assets increasingly are held by older Americans, fraudsters can be expected to follow Willie Sutton’s example and go where the money is. That’s why the SEC’s partnership with state regulators to safeguard the assets of older Americans is so important.”
President Struck, who also serves as Wisconsin Securities Administrator, said, “We are pleased to work shoulder-to-shoulder with the SEC to help protect our nation’s seniors. This initiative reflects the long-standing collaborative relationship between state and federal securities regulators and we believe it will lead to significant protections for senior investors.”
Mr. Cox and Ms. Struck said federal, state, and NASD regulators already have initiated on-site examinations in Florida of firms sponsoring “free lunch” investment seminars to ensure their sales practices are lawful. Mr. Cox and Ms. Struck announced that these coordinated examinations will be expanded to additional states where seniors may be targets of abusive sales pitches or fraudulent investment schemes.
SEC regional offices also will work closely with state and local law enforcement, and both federal and state regulatory agencies, to exchange information to help identify and bring administrative, civil, and criminal actions to shut down scams targeting senior investors.
An important part of the initiative will involve investor education and outreach to senior investors. The SEC has a “Senior Care Package” of useful brochures for seniors, which are available on the SEC’s website (www.sec.gov). NASAA’s Senior Investor Resource Center, launched on NASAA’s website in 2003 to provide investor education materials for seniors, also will be expanded. Regulators will continue to work to promote investor awareness and protection among seniors.
Pursuant to the joint initiative, a working group consisting of representatives of the SEC’s Division of Enforcement, Office of Compliance Inspections and Examinations, and Office of Investor Education and Assistance, and representatives of NASAA’s broker-dealer, investment adviser, enforcement, and investor education sections and others will meet and discuss collaborative efforts to further the initiative’s goal of protecting senior investors.
Bob Webster, NASAA, 202-737-0900
John Nester, SEC, 202-551-4120