The following provides information on a variety of topics, such as fraud, consumer credit, etc.

• Federal Trade Commission site on Cross-Border Fraud
• Federal Trade Commission Consumer Protection Division
• FDIC Brochure on Predatory Lending

FDIC Consumer Alert - January 23, 2004

The FDIC has issued an alert for consumers regarding a fraudulent email claiming the loss of FDIC coverage. The email asks consumers to verify account information to ensure coverage by the agency. Click here to go to the FDIC site and read the email.

2004 Top 10 Scams

As identified by The North American Securities Administrators Association (NASAA):
Ponzi Schemes: Uses the promise of high returns to attract investors, then uses the money collected from previous investors to pay new investors.
Senior Investment Fraud: Older investors are targeted with complex investment scams involving unregistered securities, promissory notes, charitable gift annuities, viatical settlements, and Ponzi schemes, all of which promise of inflated returns.
Promissory Notes: Short-term debt instruments that are often sold by independent insurance agents and issued by little known or non-existent companies. They often promise high returns and are used fraudulently when the issuer of the note has no intention or capability of paying returns promised.
Unscrupulous Brokers: Can include unexplained fees, unauthorized trades or other irregularities in brokerage activities. Often, the broker generates commissions for these unauthorized activities.
Affinity Fraud: Con-artists join or gain access to religious, ethnic and professional groups to sell illegal or fraudulent investments.
Insurance Agents and other Unlicensed Securities Sellers: Some insurance agents and other unlicensed securities sellers are lured by high commissions into selling fraudulent or high-risk investments, such as promissory notes, ATM and payphone investment contracts and viatical settlements.
Prime Bank Schemes: Con-artists promise high returns through access to the investment portfolios of elite banks or promise investments in "risk free guaranteed high yield instruments".
Internet fraud: Market manipulation, insider trading and unlicensed broker and investment advisory activity, including pyramid schemes. Can also include email correspondence asking for help in depositing large sums of money in overseas bank accounts, i.e. Nigerian scam.
Mutual Fund Business Practices: Mutual funds have been under investigation for putting their own interests ahead of investors' interests by using tactics such as sales contests, abusive trading practices, and illegal trading practices.
Variable Annuities: Some annuities include high surrender charges, steep sales commissions, and claims of guaranteed returns. Investors are often unaware of these items or the information is not properly disclosed. Some information, such as guaranteed returns, are fraudulent. Other information regarding tax benefits often include additional costs. Many time variable annuities are pitched to seniors through investment seminars.

Consumer Alert Issued by Nebraska Department of Banking and Finance - Dec. 5, 2003

Email is latest tool used by thieves to collect personal and/or financial information. Numerous emails are circulating that appear to be from legitimate financial institutions asking residents to verify their email address, financial information and other personal information. This information can then be used to access bank accounts or commit identity theft.

Nebraska residents are urged to never give any personal or financial information as a result of an unsolicited email request. If you have questions regarding the authenticity of the email, please contact the financial institution via telephone at a number that you know to be your financial institution. Do not use the telephone number contained within the email or any links contained within the email to verify its legitimacy.

As con-artists become more savvy with technology, it is important to note that they may even reference the actual website of a legitimate financial institution. This does not, however, make the request legitimate. The only legitimate request for any personal, identifying information from a financial institution should come only after a customer has first contacted that institution and has been told he/she will need to provide such information. It should never come in the form of an unsolicited email or telephone call.

Any Nebraska residents receiving or falling victim to such requests should report it to their financial institution and the Federal Trade Commission site on Cross-Border Fraud.

Consumer Alert Issued by Nebraska Department of Banking and Finance - Nov. 5, 2003

Nebraska residents should be wary of any emails advertising delayed deposit businesses or "payday" cash lenders without first determining if the business is licensed by the State of Nebraska.

The Nebraska Department of Banking and Finance, which regulates direct deposit businesses, is aware of one entity, calling itself "Cash Advance Expert", advertising through email solicitations. The company's website offers overnight cash advances against an individual's paycheck. It asks for personal checking account information in order to deposit this cash advance. This company is not licensed by the State of Nebraska and operates out of the Philippines.

Nebraska residents are encouraged to never give personal or financial information in response to an email solicitation. Doing so could result in theft of funds from your financial account and/or identity theft.

Protect your information

Never give out personal information over the phone or an unsecured internet site. Personal information such as driver's license number, social security number and/or bank account number can be used to access YOUR MONEY! Any legitimate business will give you ample time to consider the offer, check references and should have any terms of agreement available in writing. BE CAUTIOUS AT ALL TIMES. If you are suspicious about an offer you have received over the phone or via the Internet, contact the Department of Banking & Finance.

"Digital Investment Certificates" - Maryland Investments Club

The Canada Deposit Insurance Corporation (CDIC) is advising all North American investors and depositors that a person or group of persons conducting business as the Maryland Investments Club is offering fraudulent securities. The person(s) are offering investment certificates called digital investment certificates for sale over the Internet. They claim that these certificates are held electronically and guaranteed in full by the CDIC. The CDIC has warned that this is a fraud. Contact the Nebraska Bureau of Securities at (402) 471-3445 to report any any dealings with the Maryland Investments Club or digital investment certificates supposedly guaranteed by the CDIC.

"Prime Bank" Financial Instruments

Illegal schemes that tout the sale, trade and or redemption of prime bank financial instruments is again traversing the country. These schemes involve individuals and/or false entities claiming to sell financial instruments called a "prime bank" note, guarantee, letter of credit, or debenture. The Federal Reserve does not guarantee or license individuals to sell, trade or redeem such financial instruments. Alerts were also given in 1993 and then again 1996 about these schemes.

Nigerian Scam Letters

Beware of official looking letters offering to enter into a confidential business arrangement that supposedly results in several million dollars being put into your bank account. These letters have been circulating throughout the country since the mid 80s - including Nebraska. It is known as the Nigerian Advance Fee Fraud and has resulted in a depletion of bank accounts, and even the death of an American businessman in 1995, according to the U.S. State Department. New variations of the Nigerian Advance Fee Fraud are being developed all the time. Some such variations include: the transfer of funds from "over-invoiced" contracts and assistance in escaping the country with accumulated wealth to contract fraud and the sale of crude oil, among others. Following are tips to help avoid being a victim in this and similar frauds.

• Do not respond to business proposals that ask for your personal banking information, letterhead stationery, blank business statement forms or money.
• Do not give credit card numbers or other account numbers to businesses unknown to you.
• Research any business proposals that requires personal information or money with your bank, the Better Business Bureau, and the Consumer Protection Division of the Attorney General's office.
• Always be cautious about submitting advance fees for any business or sweepstakes offer. Some advance fees are illegal in Nebraska.
• If an offer sounds too good to be true, it probably is.

For more information on the Nigerian Advance Fee Fraud, visit these websites:

• U.S. State Department
• Crimes of Persuasion
• The 419 Coalition
• Links to Organizations Fighting Nigerian Fraud
• Internet Fraud Complaint Center
• U.S. Secret Service

When is Your Check Not a Check? Electronic Check Conversion

The Federal Reserve Board published a guide to help consumers understand their rights and responsibilities with regard to electronic check conversion transactions. The guide, "When is Your Check Not a Check? Electronic Check Conversion," discusses what electronic check conversion is, how consumers can tell if their check will be electronically converted, some of the differences between a regular check transaction and electronic check conversion, consumers' rights in an electronic check conversion transaction, and what consumers can do if they have problems with such transactions. The publication is located on the Fed's web site at www.federalreserve.gov.

Protect yourself from Mortgage Fraud

The best method of protection is knowledge. Learn how to shop for the best mortgage and your rights as a consumer. A Department of Justice Mortgage Booklet gives consumers valuable information when shopping for a mortgage! If you think you have been the victim of mortgage fraud, file a written complaint with our Department.

If you are going through foreclosure or need other home ownership counseling services, contact the Family Housing Advisory Services at 1-888-573-0495 for assistance.

Visit the following sections to learn more about how to protect yourself. Or visit our Consumer Education page to learn more about how to safely invest your money.