The internet permits communication across large demographics without effort, money or time. By going to a website or an online bulletin board or sending an email, anyone can reach thousands of people in one go. This includes scammers. While scammers create an online scam that looks real and believable, the investors and victims cannot tell the difference between fiction and truth. Report an online scam and alert investors to financial fraudsters by approaching the Securities Exchange Commission.

Fraudsters may use the internet to promise mind-blowing returns to investors. Online offerings that do not comply with federal securities laws are what you need to watch out for. Federal securities laws requires US SEC to maintain orderly and efficient markets. How do you report an online scam to the SEC? Read on to know more.

  • Reporting Online Scam to the SEC

The United States Securities and Exchange Commission aims to provide protection for investors, maintain fair practices in the market and facilitate formation of capital. Shareholders need to be alert when the SEC cautions them against an online fraud. Report an online scam to the SEC created to safeguard the system. First time investors who turn to the markets or advanced investors can easily monitor fraudulent financial schemes and report an online scam to this organization. Securities Exchange Commission is a democratic financial institution created for the people. It acts as an advocate on behalf of the shareholder and provides guidance on filing complaints to report an online scam.

  • Functions of the SEC

The Securities Exchange Commission checks the key participants including exchanges, brokers, investment advisors, dealers and mutual fund managers. SEC is concerned with fair deals and preventing unlawful disclosure or fraud. The world of investing is a complex one. But unlike the banking system, where returns are guaranteed, investors in the market need not win big. This is why fair play is important and you need to report an online scam to the SEC.  As a shareholder, you are entitled to information. A key function of the SEC is to permit access to information. All investors, regardless of their size or buying power should aim for accessing basic facts before holding the investment. SEC requires public firms to disclose valuable financial data to the public. A common pool of knowledge is essential to judge if investors can purchase, sell or hold a specific security. Through accurate and precise information and facts and figures you can rely on, investors can make an informed decision.

One of the major ways the SEC detects an online fraud is through the investors. Investors who report an online scam do the SEC and the industry a favor. Careful, literate investors can support the functioning of markets effectively and efficiently. SEC offers a vast wealth of information on the website including the EDGAR database of disclosure documents. So, whether you want to report an online scam or gather data about one,  the SEC can help. The types of frauds for which you can report an online scam include:

  • High yield investment/pyramid/Ponzi scheme
  • Theft of funds and securities
  • Misappropriation of funds
  • Change in security price or volume
  • Insider trading
  • Unregistered securities
  • Factually incorrect information about a company
  • Fake, misleading SEC reports or financial statements
  • Short selling and bribery
  • Fraud in association with public securities

Check the SEC website to study how to report an online scam regarding a finance professional or investment. Order handling, trade execution and confirmations as well as delivery of funds are some of the factors where online scammers may operate. Report an online scam to the SEC and save the economy and the industry from manipulation.

SEC has a unit for whistleblowers (http://www.sec.gov/whistleblower). As the SEC is in charge of overseeing the functioning of companies and financial organizations, the aim is to encourage responsible investment and provide support for those who report an online scam.

 

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