SEC Alerts Investors to Scams Involving Fake Form 4

In a recent Investor Bulletin, the SEC Office of Investor Education and Advocacy ("OIEA") cautioned investors about "potential investment schemes in which fraudsters send fake Forms 4 to investors who paid for the purported purchase of shares." Form 4 filings are disclosure filings by corporate insiders that report the purchases and sales of their company's securities.

In the Investor Bulletin, the OIEA warned that:

• if an investor buys a security through a U.S.-registered broker-dealer, then that broker-dealer must send a trade confirmation statement, since the SEC does not send trade confirmations;

• Forms 4 that are used as confirmations of purchases or transfers of shares effectively are red flags;

• investors should double-check the backgrounds, registrations and license status of all firms and financial professionals through the SEC Investment Adviser Public Disclosure database; and

• the SEC has received complaints of fraudsters who use "official-looking domain names."