SEC Commissioner Gallagher Speaks to Military Servicemen and Women about SEC Investor Education
SEC Commissioner Daniel M. Gallagher delivered opening remarks on SEC investor education and advocacy to military servicemen and women at Fort Hood.
Commissioner Gallagher explained that it is not the SEC's job to eliminate all risk from the securities markets, since risk ensures vibrant securities markets for investors. However, he noted that in certain areas, the SEC must help to reduce risk for servicemen and women to ensure that military families can invest responsibly and avoid "falling into the financial traps that all too often befall members of our armed forces."
Commissioner Gallagher warned against "affinity fraud," explaining that even if the investor knows the person who is making the investment offer, it is important to check not only the investment but also the person's background. Additionally, he cautioned against the payday lending industry, which he described as an area that is "ripe for potentially predatory practices targeted at members of the armed services." Although the SEC does not regulate those entities, Commissioner Gallagher stated, the SEC offers resources to help service members avoid predatory traps in that industry.
Commissioner Gallagher emphasized that the best way to avoid legal traps and scams is to acquire a solid understanding of the financial marketplace. He noted that the SEC is an active member of the U.S. Department of Defense's Financial Readiness Campaign, and conducts financial workshops on military installations throughout the country. He recommended that military members utilize the Investor.gov Web site, which has dedicated resources to retail investors, including service members and their families.