FINRA Introduces Resources for Companies, Employees to Guard Against Early Retirement Seminar Scams

Washington, D.C. — The Financial Industry Regulatory Authority (FINRA) today launched two online resources to help companies and their older workers protect themselves from early retirement scams.

The resource for companies, Help Your Employees Achieve Their Retirement Dream: Tips for Spotting Early Retirement Scams, offers tips on how to evaluate the financial professionals involved in early retirement seminars and the seminar materials such as invitations, slides, handouts and scripts. Company representatives may also refer early retirement seminar materials to FINRA for review if they have concerns. FINRA staff will review all seminar materials referred and inform the company whether the materials are consistent with applicable standards.

A second resource, Early Retirement Seminars 101: Smart Tips for Spotting Retirement Scams, alerts employees to the pitfalls of early retirement schemes. The resources are a two-pronged investor education initiative in the wake of two major FINRA enforcement actions that involved multi-million-dollar fines and tens of millions in restitution to employees. Additional investigations are currently underway.

"Companies offer retirement benefits to help employees lay the groundwork for financial independence when they leave the workplace," said FINRA CEO Mary L. Schapiro, who was recently appointed to the President's Advisory Council on Financial Literacy. "Companies don't want to unwittingly help scamsters lure their employees into cashing in their retirement investments early with misleading promises of big financial returns — and comfortable retirement lifestyle — that simply can't be sustained."

"While many third-party seminars offer solid information, others — especially those that promote early retirement — may not be appropriate," Schapiro said. "Some seminars include misleading assumptions about investment returns, suggest risky withdrawal strategies, or lead to outright fraud."

The Society for Human Resources Management (SHRM), the world's largest association devoted to human resource management, has made the FINRA resources available to its members on its Web site at www.SHRM.org.

"This is valuable information," said SHRM Board Chair Janet Parker, who also serves on the President's Advisory Council on Financial Literacy. "As more and more of the baby boomers in the work force near retirement age, human resource professionals can play an important role in helping them safeguard their retirement resources. FINRA's resources can help employees identify sound financial guidance."

Help Your Employees Achieve Their Retirement Dream: Tips for Spotting Early Retirement Scams and Early Retirement Seminars 101: Smart Tips for Spotting Retirement Scams are available at www.finra.org/investor and at www.shrm.org/financialliteracy.

For more information about FINRA enforcement actions regarding early retirement seminars, see Citigroup Global Markets to Pay Over $15 Million to Settle Charges Relating to Misleading Documents and Inadequate Disclosure in Retirement Seminars, Meetings for BellSouth Employees and NASD Fines Securities America $2.5 Million, Orders $13.8 Million in Restitution in Investment Scheme Aimed at Exxon Retirees in the Press Room section of FINRA's web site, www.finra.org.

FINRA, the Financial Industry Regulatory Authority, is the largest non-governmental regulator for all securities firms doing business in the United States. Created in 2007 through the consolidation of NASD and NYSE Member Regulation, FINRA is dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business-from registering and educating all industry participants to examining securities firms; writing and enforcing rules and the federal securities laws; informing and educating the investing public; providing trade reporting and other industry utilities; and administering the largest dispute resolution forum for investors and registered firms. For more information, please visit our Web site at www.finra.org.