The Register-Herald, Beckley, West Virginia

Local News

October 16, 2008

Investment scams target senior citizens, auditor warns

By Fred Pace

Clarence Brown Jr. says the nation’s financial crisis has him “scared to death.”

“When you start seeing banks fail and the Wall Street meltdown, then you start worrying about your money and investments,” the Beckley man said.

Brown was one of several senior citizens who attended an educational forum given by state Auditor Glen Gainer at the Raleigh County Commission on Aging senior center in Beckley Thursday.

“The state auditor’s office is working with AARP to get common-sense banking and investment information to seniors,” Gainer said.

Gainer added that senior citizens are the main targets of those running investment scams.

“Any time we see the stock market take a tumble like it has recently, people start getting concerned about their retirement, savings and investments,” he said. “We also see an increase in people coming into West Virginia to take advantage of our senior citizens.”

Gainer says some investment opportunities may sound exciting but could be illegal scams.

“Senior citizens are often offered glorious promises of doubling their money or guaranteed growth every month,” he said. “They are most likely pyramid schemes or other types of investment scams that could deplete a senior’s life savings.”

Gainer warned seniors that scam artists count on the fact that most of them have retirement savings.

“They will tell you whatever they can to get their foot in the door,” he said. “Then they will do their best to separate their victims from that money.”

Gainer said stock brokers or dealers, investment advisers and their firms which do business in the state are required to register with the West Virginia Securities Commission, a division of the state auditor’s office.

Gainer said investors or investment firms are also required to register information on a secure national database.

“All of that information is available to the public at no cost,” he said.

Gainer urged seniors to do research before investing money.

“You must check out an investor before giving them your money,” he said. “You can do that by contacting the state auditor’s office. Don’t just blindly give away your money.”

Gainer said despite the national financial crisis, West Virginia’s banks are on solid financial ground.

“The banks in West Virginia have been very conservative and have not made the risky decisions we have seen in other states,” he said.

Pauline Smith, 77, of Beckley, thought Gainer’s information was helpful.

“I felt very comfortable about my money and investments after hearing him speak,” she said. “He gave us a lot of useful information.”

— E-mail: fpace@register-herald.com

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