Understanding Investment And Fraud Threats During COVID-19

Leave it to imaginative frauds and scammers to come up with a plan through which to bilk people out of their hard-earned money – and during one of the most distressing occurrences to take place in the United States in a long time. Investment and fraud threats are running rampant while COVID-19 devastates more and more individuals, families, and businesses every day.

Sadly, the opportunity for fraud seems to increase as turmoil elevates. The coronavirus has impacted the daily lives of many. This includes the stock market, the economy, and much more. FINRA, the regulatory body for the securities industry, has issued a warning to investors regarding COVID-19 fraud and investment threats.

Scams, Fraud, And More

During COVID-19, new scams have been created. During the crisis, however, new life has been breathed into many old scams, as well. In ways that are both unfamiliar and familiar, recent events have left investors vulnerable. The remote working environment has very possibly been the greatest shift affecting not only Americans but millions of people worldwide.

Fraudsters, or bad actors, have been using customer relationships with firms – and investor communications in particular – to take peoples’ money. Remaining vigilant is the best way to fight against this new fraud outbreak. This applies to investors, brokers, and broker-dealers alike.

Watch Out for the Following Scams

Here are four scams that were brought to our attention by FINRA:

  • Schemes Involving Business Email Compromise – These typically involve individuals that have legitimate fund transfer capability or abilities. In an email from someone that the individual is used to doing business with, a request is made to send funds to a new account.
  • Scams Involving IT Help Desks – A new way to trick investors is offered to scam artists through recently adapted remote work arrangements. Customers are contacted by fraudsters pretending to have an IT problem solution that is directly related to the financial firm of the customer. Account numbers, passwords, and login information can be stolen, as well as other personal confidential information.
  • Firm Imposter Scams – Once again, telecommuting and remote work environments helped set up this scam. Investment professionals and broker firms are impersonated by these fraudsters. Customers are tricked into handing over passwords, usernames, logins, existing account information, and other personal info.
  • Fraudulent Money Transfers and Account Openings – Fraudulent new accounts have spiked, according to brokerage firms reporting to FINRA. Firms offering to open online accounts are most at risk here. To divert payments and/or funds, phony accounts are used by fraudsters.

About Weltz Law And Investment Scams and Fraud 

Irwin Weltz, Thomas Wolinetz, Eleni Kakos, Gabriel Gerbi, and Robert Volynsky, originally founded Weltz Law. Since then, we have successfully represented investors nationwide in all aspects of securities and commercial litigation. One example of our services includes the representation of broker misconduct and fraud victims. We’re also experienced in representing clients in a vast array of other matters.  

If you have been approached by someone you feel may be a fraud or a scammer, do not hesitate to alert the authorities. If you've already been the victim of a scam, con artist, fraud, etc., contact the knowledgeable and experienced representatives at Weltz Law.

On our website, you can see for yourself what we have achieved for others by reviewing individual case results. Though our focus is basically FINRA arbitration against stock brokers and financial advisors, feel free to contact us should you want to discuss something else with one of our representatives.