SEC Online Day Trading Warnings and Tips

The Security and Exchange Commission (SEC) sometimes issues warnings and tips pertaining to all aspects of online ay trading as well as other online financial activities. These are issued on a regular basis to help warn people of fraudulent activities in order to make their trading experience as worthwhile as possible.

Online Fraud Precautions

Fraudsters can be very tricky when engaging in activities that result in the theft of peoples’ hard earned investment money.

Watch out for fake seals. This can be done more easily than you think. They might, for instance, copy a seal from the SEC website and place it on their own. This is a fraudulent act in itself, as the Securities and Exchange Commission does not endorse private use of their label. They also do not endorse any specific security, broker’s firm, individual, professional, service, or product related to financial exchange.
Verify a regulator. If you are looking for a securities regulator make sure you choose one that is enlisted and approved by the SEC.  Do not deal with any companies that just plaster a fake seal on their site saying they are approved by the SEC. Do not just take their word for it.
Beware of the words “government approval.” Of course, legitimate investment firms may use this phrase. However, watch out for the ones that misuse it. Always verify any broker website or other site that is connected to financial firms who deal with stocks, bonds, securities, currencies, etc.
Fancy websites don’t mean a thing! A website can look very pretty, and it can function quite nicely. It can even provide you with Flash or other useful navigation and interactive tools. However, this does not necessarily mean it a worthwhile investment avenue nor does it mean it is legitimate. In the same vein, watch out for fancy letterheads.
Be reluctant to give into “advanced fees” offers. Never give any so-called investment company any money up front if you do not know what exactly it is for. Fraudulent companies claim they can help you minimize or prevent losses if you pay them up front. Often this supposed “fee” is represented as an “activity fee,” “tax,” “deposit,” or “refundable bond.”
Stay away from supposed “recovery room” offers. This is another type of scheme that involves the payment of an advanced fee of some kind. This is a scam that is very closely related to the “advanced fees” scam described above. This leaves investors behind and they end up experiencing even a greater loss.