What’s old often becomes new again and that holds true for scams.  The Financial Industry Regulatory Authority (FINRA) has issued guidance warning investors about the latest scam being used.  What’s the scam?  Cold calls to investors rather than emails.

Here’s a quick overview of the FINRA alert:

  • Investors get a cold call from someone claiming to be from a well-known brokerage firm;
  • The scammer is claiming to be offering the investor a certificate of deposit (CD) with a CD yield that is way above the best market rates;
  • To get this great CD rate, the investors has to give her or his personal information (e.g., SSN) and financial information (e.g., financial account numbers) to the scammer.

The only potential “returns” an investor might get from this scam are terrible — possibly having his or her identity stolen and/or having funds stolen from a financial account.

Gerri Walsh, FINRA’s Senior Vice President for Investor Education offers concrete steps to investors who get this type of cold call.   She advises investors getting this type of call to end the call ASAP; to call their investment firm’s customer service center (found on an account statement or the firm’s website); to never provide personal and financial information to “cold callers”; and to never authorize a funds transfer to an unknown caller.

This and other excellent anti-phishing guidance can be found on the FINRA website (www.finra.org; “FINRA Issues New Investor Alert, Cold Calls From Brokerage Firm Imposters-Beware of Old-Fashioned Phishing”; August 6th).