North American task force tackles pandemic scams

State and provincial regulators have exposed hundreds of fraudulent schemes seeking to capitalize on the Covid-19 pandemic, the North American Securities Administrators Association (NASAA) says.

The group of regulators has reported that its Covid-19 Enforcement Task Force has detected 262 scams connected with the pandemic, including 168 investment frauds.

NASAA said that regulators have taken 250 actions — including administrative actions, cease-and-desist orders, referrals to other regulators, and requests to social media and online hosting companies — against these kinds of schemes.

The scams uncovered by the task force include pitches to invest in limited partnerships, penny stocks, and private placements that involve purported medical technology. Also on the list are initial coin offerings and other cryptocurrency schemes, and crowdfunding initiatives.

“Through the task force, state and provincial securities regulators successfully raised awareness of how fraudsters can use the pandemic to cloak schemes to steal money from unsuspecting investors,” said Lisa Hopkins, president of NASAA and West Virginia’s senior deputy securities commissioner, in a release.

NASAA said that its Covid-19 task force, which involved 111 investigators representing 44 jurisdictions, “represents the largest coordinated enforcement initiative undertaken by state and provincial securities regulators.”

“Fraudsters should know that the work of the task force is not over and that state and provincial securities regulators will continue to take decisive action to shut down their schemes,” Hopkins added.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.