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Kristina Frunze

10 August 2018

Regulation Forex

US SEC Adds 29 Fraudulent Firms to Its Warning List

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US SEC adds 29 fraudulent firms to its warning list, mentioning that firms were providing inaccurate or misleading information regarding their affiliation, location, or registration. 

10 August, AtoZ Markets – The Securities and Exchange Commission (SEC) has made updates to its warning list, thus adding 29 unregistered companies. According to the regulator, these firms have been soliciting non-US investors.

US SEC Adds 29 Fraudulent Firms to Its Warning List

The regulator notes that 16 our 29 companies are soliciting entities, nine are fake regulators and four of them are clone firms. In the US, financial firms that intend to provide their services to the investors in the country, need to have a valid registration with the SEC. In order to obtain a registration, companies should meet the minimal financial standards. They also should meet disclosure, reporting and recordkeeping requirements.

The new additions to the SEC’s warning list have been spotted as the regulator noticed that they do not meet the abovementioned standards. Specifically, the US SEC has stated that firms were providing inaccurate or misleading information regarding their affiliation, location, or registration. 

However, the list of the new updates to the SEC’s website does not only features firms falsely claiming registration. It also includes clone firms, which are described as companies that try to trick investors into thinking they are some other genuine company. In order to do so, these entities usually have similar addresses, names and website URLs.

Please find the complete list of unregistered entities here.

"SEC registration is no guarantee against fraud"

The SEC’s list also features a number of fake regulators. These firms are pretending to the government agencies with the purpose of misleading investors and tricking them into sending money.

This update to SEC’s warning list appears as a part of its wider effort to protect retail investors from fraudulent firms and scammers. The Chief of the SEC’s Office of Market Intelligence, Jennifer Diamantis, has commented on the update:

“While SEC registration is no guarantee against fraud or mismanagement, it does bring a higher level of security and accountability to protect the public. Investors should proceed with caution if any unregistered entity attempts to solicit them.”

However, if the entity has made it to regulator’s warning list, this implies that the watchdog has reasons to believe the activities of this particular firm are suspicious. 

Think we missed something? Let us know in the comments section below. 

The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZMarketz.com, nor should they be attributed to AtoZMarkets.

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