May 28, 2018
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Service aims to guide Mainers’ investment decisions

By Judith Shaw, Special to the BDN

The Bangor Daily News recently reported on Maine investors who found themselves caught up in the Madoff Ponzi scheme. The story included words of wisdom from the victims. Beyond their sound advice, there are resources and services offered at the state level to help consumers make informed investment decisions and safeguard their financial assets.

For many of us, our investments in stocks, bonds and mutual funds make up a sizable portion of our retirement nest egg. They represent a lifetime of hard work and faithful contributions. The market’s recent volatility is worrisome enough, but the thought of losing our investments through unscrupulous activity on the part of a trusted broker or adviser is more than most of us can stand.

Although the best oversight systems fail at times, and it may never be possible to completely eliminate the potential of a Madoff-type scandal in the future, the federal government has a responsibility to determine how federal oversight might have prevented the current case and to identify changes that ensure greater protections. This review process is under way.

What is sometimes unknown or overlooked by the public is that state regulators are available to help consumers as they evaluate investment products, firms and professionals. Here in Maine, the Office of Securities within the Department of Professional and Financial Regulation employs experienced investigators and other staff members who are committed to providing investors with a first line of defense against fraud and scams.

Protecting investors and punishing those who commit financial crimes are central roles for state securities regulators. Putting investors first is more than a slogan at Maine’s Office of Securities. It’s what we do for residents on a daily basis.

In 2008, the office was able to obtain more than $915,000 in restitution to consumers who were taken advantage of by thoughtless, careless or outright criminal investment professionals. When legal action was appropriate, it was vigorous pursued.

In one instance, an unlicensed individual pleaded guilty to securities fraud and deception, the unlicensed sale of securities and theft by misapplication of property. His crimes included convincing people to invest in unregistered securities (mostly overseas) and promising extremely high rates of return — as much as nearly 400 percent. The court sentenced him to two years and nine months in prison. Upon release, he’ll be on probation for three additional years. The court also ordered him to pay restitution totaling more than $2 million.

In a second case, another person pleaded guilty to theft by deception and securities fraud. His questionable career path began in New York in 1986 with a conviction for petty larceny and continued when he moved to Maine in 2005. While in Maine just one of his schemes involved convincing people to invest in Italian real estate with the promise of a healthy profit. Instead of making those investments, he used the money to pay for his own living expenses. This individual will serve four years in prison followed by two years of probation upon his release. The court also ordered him to pay total restitution of more than $150,000.

Tough and consistent regulatory oversight is one of the keys to helping investors maintain confidence in the market. Understandable and accessible investor education services are also fundamental. The Office of Securities makes a variety of informative tools and materials available online, through the mail, over the phone, and in person. We provide training to law enforcement officials and advocates for the elderly. We conduct educational workshops and seminars for the general public. And we always seek to improve our outreach and resources.

The bottom line is simple: Money never should be invested without a thorough understanding of the investment product and a complete review of the company or individual offering it. The starting point is also simple: Contact the Maine Office of Securities. We can work with you to make sure the product, investment company and broker or adviser are properly registered. We can also make you aware of any disciplinary action that might have been taken against the investment firm or professional. Additionally, we might help you to evaluate the appropriateness of the investment product.

The Office of Securities is also the place to report concerns about questionable investment events or practices. You can call toll-free at 877-624-8551. For individuals with hearing difficulties, the TTY line is 624-8563. Information and the complaint process can also be found online at We are here to serve you by being your first line of defense against scams and other investment problems.

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