In this scheme, the victim pays pays money to someone in anticipation of receiving something of greater value, but then receives little or nothing of value in return. The variety of advance fee schemes is limited by the imagination of the scam artists who offer them. Advance fee scams can involve the sale of products or services, the offering of investments, lottery winnings, gifts, or any other windfalls. One version of this type of scam might begin with a phone call offering to pay the investor an enticingly high price for shares of the investor's stocks that are virtually worthless (sometimes referred to as "non-performing"). To build legitimacy, the caller refers you to a phony Web site containing investor protection information, or poses as a legitimate securities professional or regulator. The investor is asked to send a fee in advance to pay for their services. Once the investor's money is sent, the investor will not see some or any of the money again.
For more information, see:
- Financial Industry Regulatory Authority (FINRA): http://www.finra.org/Investors/ProtectYourself/InvestorAlerts/FraudsAndScams/P014928 FINRA’s investor alert on Well-Traveled Fraud—Advance-Fee Scams Target Non-U.S. Investors Using Fake Regulator Web Sites and False Broker Identities. http://www.finra.org/Investors/ToolsCalculators/BrokerCheck/index.htm use FINRA's BrokerCheck to check out the caller.
- The Securities and Exchange Commission (SEC): http://www.sec.gov/investor/pubs/fakeseals.htm The SEC's publication on Fake Seals and Phony Numbers: How Fraudsters Try to Look Legit.
- North American Securities Administrators Association (NASAA): http://www.nasaa.org/NASAA_Newsroom/Current_NASAA_Headlines/3454.cfm NASAA Warns Investors to Beware of Phantom Regulators.