U.S. brokerage liquidator warns of bogus websites, phishing scams

Reuters News
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Posted: Nov 05, 2014 1:36 PM

By Jonathan Stempel

(Reuters) - A U.S. brokerage liquidator that has helped victims of Bernard Madoff's Ponzi scheme recover money on Wednesday warned consumers to beware of bogus firms and websites claiming to help investors involved with failed brokerages.

The Securities Investor Protection Corp said it is aware of two websites that it believes are falsely claiming to help protect U.S. and non-U.S. brokerage customers, whether by posing as SIPC or claiming its powers.

SIPC said such "phishing" scams involve con artists who trick people into paying up-front fees, providing access to

brokerage accounts, sharing personal information, or otherwise sending money and other assets. SIPC said many suspect websites are hosted overseas, beyond the reach of U.S. authorities.

"It seems to come and go in waves," SIPC President Stephen Harbeck said in an interview. "Whenever we see an uptick, we don't just notify the FBI, but also let investors know."

SIPC is a nonprofit created by Congress and funded by the brokerage industry. It works with court-appointed trustees to return cash and assets to customers of struggling or bankrupt brokerages.

Harbeck said SIPC does not charge fees to recoup investors' assets, and urged investors to be "extremely wary" if a supposed brokerage liquidator requests fees or personal information.

The two websites named by SIPC are associated with firms named Alliant Trust Systems, and Investment Assurance Corp. IAC's website says that firm is based in Chicago's Loop.

Harbeck said SIPC has not received specific complaints about the websites, but discovered them when a staff lawyer found they contained language mimicking SIPC's own.

The firms also include press material on their respective websites claiming that Harbeck is their president. Harbeck said he is not, and never was.

Alliant and IAC did not immediately respond to emailed requests for comment. A phone number and email address provided by IAC for a spokesman were disabled. A man who answered another phone number provided by IAC said that number was wrong.

Madoff is serving a 150-year prison term for what prosecutors called a $64.8 billion fraud.

(Reporting by Jonathan Stempel in New York; editing by Andrew Hay)