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Investors Beware of Phony SIPC “Look-Alike” Website Targeting Madoff Victims

03/09/2010

The SEC is warning investors about a website that falsely claims that $1.3 billion in Madoff money has been found in Malaysia and encourages individuals to submit information to verify that they are on a refund list. The website was created as a fake mirror image of the Securities Investor Protection Corporation’s (SIPC) website.

To prevent Madoff victims from disclosing confidential financial information because they hope to recover some of their losses, SIPC issued a press release warning them about a fictitious entity known as the International Security Investor Protection Corporation (ISIPC). The ISIPC website mimics almost exactly the look, feel, and content of SIPC’s website – with one notable exception. The ISPIC website claims to partner with several legitimate governments, including the United States – linking to web pages maintained by these governments. ISIPC also falsely claims to be sponsored by the United Nations, the International Monetary Fund, the World Bank and the IBA. The IBA was the subject of an earlier investor alert.

Con artists worldwide often target investors who already have lost money in a financial fraud. These con artists rely on the victim’s desire to recoup their losses as quickly and as fully as possible, encouraging individuals to submit information to verify that they are on a refund list.

It’s not hard to figure out who the real regulators and legitimate entities are and how you can contact them. But make sure the URL matches the ones listed below:

  • International Regulators – You’ll find a list of international securities regulators on the website of the International Organization of Securities Commissions (IOSCO) at http://www.iosco.org. SIPC recently has joined IOSCO as an ancillary member.
  • FINRA – The federal securities laws require that virtually every securities firm doing business with the U.S. public must be a member of FINRA. You’ll find information on how FINRA registers and governs its members firm on FINRA’s website at http://www.finra.org.
  • Securities and Exchange Commission – Our website is http://www.sec.gov. You’ll find legitimate contact information for the SEC in the Contact Us section and on SEC Division Homepages. If you’re ever unsure whether you’re dealing with someone from the real SEC, submit Questions and Comments Form.
  • Securities Investor Protection Corporation (SIPC) - SIPC is a non-profit organization created by Congress in 1970 to protect the customers of insolvent brokerage firms. You’ll find the real SIPC at http://www.sipc.org/index.html.
  • State and provincial regulators in Canada, Mexico, and the U.S. – You’ll find a directory on the website of the North American Securities Administrators Association (NASAA).

The Office of Investor Education and Advocacy has provided this information as a service to investors. It is neither a legal interpretation nor a statement of SEC policy. If you have questions concerning the meaning or application of a particular law or rule, please consult with an attorney who specializes in securities law.