A rash of investment professional impersonations — including of registered representatives and investment adviser representatives — has prompted a warning from the FBI and SEC.
The fraudsters are fielding more sophisticated scams with the help of artificial intelligence and other new tech, according to a news release from the FBI’s Criminal Investigative Division and the SEC’s Office of Investor Education and Advocacy (OIEA). They also warn that social media makes it easier than ever for crooks to contact investors. Impersonators use Facebook, LinkedIn, WhatsApp (including through investment-related groups or chats) and other platforms to lure investors to a fake website by posting bogus comments online — even on YouTube videos.
Federal authorities say scammers not only impersonate investment professionals, they may try to pass themselves off as firms registered with a state securities regulator, FINRA or the SEC.
Impersonator Tricks
Impersonators may:
Use the name or other information of a real investment professional or firm to create email, social media or online ad accounts; incorporate legal entities; or register website domain names.
Create bogus websites using a photo, logo or website likeness of an investment professional or firm, or that link to the actual website of an investment professional or firm.
Call from a spoofed phone number that seems to be connected to a real investment professional or firm.
Copy real information about the investment professional they impersonate, including registration number, employment history and credentials on FINRA’s BrokerCheck website or the SEC’s Investment Adviser Public Disclosure database.
Recommend that the investor research the investment professional or firm they are impersonating.
Disguise their identities with a voice-changing app, messaging service, writing assistance software, or AI-generated content, including altered photos, deepfake videos and cloned voices.
Avoid the Scams
Here are some ways the SEC recommends to avoid being scammed by an investment professional:
Verify the person you are communicating with is an investment professional at a registered firm. One method is to contact the professional via a phone number or website listed in the firm’s Client Relationship Summary (Form CRS). Follow these steps to make sure the Form CRS is genuine:
Go on Investor.gov. In the “Check Out Your INVESTMENT PROFESSIONAL” search field, select “Firm” from the drop-down options and type in the firm’s name.
In the search results, select the firm and click on “Get Details.”
Select “Relationship Summary” or “Part 3 Relationship Summary.”
Only use contact information that you independently verify, as explained above; don’t use the website or contact information provided by the person.
Don’t rely on contact information in messaging forums or on social media, such as in Instagram or LinkedIn profiles. An impersonator may have posted it.
Be wary if the person asks to communicate through an encrypted messaging app, such as Telegram or WhatsApp, or an email address that appears unrelated to the firm.
Be skeptical if the person won’t give a phone number, won’t talk on the phone or won’t meet with you in person or over video chat. Scammers may impersonate an investment professional on the phone, over video chat, or in person. But refusing to talk or to meet with you is a red flag.
Don’t rely only on customer reviews or testimonials when deciding on an investment. Scammers can publish fictitious customer reviews or pay people to make fake testimonial videos.
