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District of Columbia Department of Insurance, Securities and Banking Joins Task Force Cracking Down on COVID-19 Investment Scams

Monday, May 11, 2020

Washington, DC—The Bowser Administration announced today that the Department of Insurance, Securities and Banking (DISB) has joined an international enforcement task force organized by the North American Securities Administrators Association (NASAA) to investigate fraudsters looking to capitalize during the coronavirus (COVID-19) public health emergency.

“As part of Mayor Bowser’s efforts to protect District residents, we are proud to join our colleagues in NASAA’s COVID-19 Enforcement Task Force,” said DISB Acting Commissioner Karima Woods. “Investment schemes related to COVID-19 are a significant threat and we are dedicated to effectively protecting investors.”

The Department is a member of NASAA, the membership organization of state and provincial securities regulators in the United States, Canada and Mexico. The task force consists of state and provincial securities regulators and was formed to identify and stop potential threats to investors stemming from the COVID-19 pandemic. Task Force members are using online investigative techniques to identify websites and social media posts that may be offering or promoting fraudulent offerings, investment frauds, and unregistered regulated activities.

To assist in protecting investors from COVID-19 investment scams, the Department also encourages public reporting of suspected fraudulent COVID-19 investment offers. Investors who suspect they fell victim to COVID-19 related investment scams or have questions about a solicitation should contact DISB’s Enforcement and Consumer Protection Division at (202) 727-8000.

“Reporting suspicious COVID-19 related investment offers helps DISB investigate and prosecute illegal activities and protect our citizens from financial fraud during this unprecedented moment,” Woods said.

A critical component of fighting fraud is investor awareness. To help investors identify common telltale signs of possible investment fraud, DISB suggests three questions to ask before making a new investment.

  1. Is the investment being offered with a guaranteed high return with little or no risk? All investments carry risk that you may potentially lose some, or all of, your money. Anyone who says their investment offer has no risk is lying. No one can guarantee an investment return.
     
  2. Is there a sense of urgency or limited availability of detailed information surrounding the investment? If someone offers you a “can’t miss” investment opportunity and pressures you to invest right now, don’t be afraid to walk away.
     
  3. Is the person offering the investment, and the investment itself, properly licensed or registered? For the same reasons you wouldn’t go to an unlicensed doctor or dentist, you should avoid unregistered investment salespeople and their products.

“Make sure you have all the facts before you hand your money over to someone else to invest,” Woods said.

For an updated list of financial resources and services, visit disb.dc.gov or follow @DCDISB on Twitter. For updates on the District’s response to the coronavirus (COVID-19), visit coronavirus.dc.gov.

About DISB

The mission of the Department of Insurance, Securities, and Banking (DISB) is three-fold:

(1) cultivate a regulatory environment that protects consumers and attracts and retains financial services firms to the District; (2) empower and educate residents on financial matters; and (3) provide financing for District small businesses.