Texas State Securities Board Update on North American Response to COVID-19 and its Impact on Retail Investors

Jun 16

The North American Securities Administrators Association (NASAA) today updated the status of the work of the COVID-19 Enforcement Task Force, consisting of state and provincial securities regulators, to identify and stop potential threats to investors stemming from the pandemic.

Since March 1st, the Texas State Securities Board has opened more than 145 investigations into suspect securities fraud or otherwise illegal investment opportunities in Texas.  The Securities Commissioner has brought a number of actions to protect Texans from fraud, including 10 enforcement orders against 16 respondents accused of illegally offering securities to Texans.  The agency has referred 3 criminal cases to local prosecutors, a grand jury handed down indictments against a securities promoter accused of stealing money and authorities arrested another suspect accused of fraud. 

“It’s the tip of the iceberg,” said Commissioner Iles.  “Criminal opportunists are continuing to leverage present economic disruption to defraud the investing public.”

Commissioner Iles cited the agency’s collaborative work as part of an international task force organized to identify and stop potential threats to investors stemming from the pandemic. 

The task force, organized by the North American Securities Administrators Association, consists of more than 100 investigators from 44 jurisdictions including Texas, other states, Canada and Mexico.  It formed in April and is led by NASAA’s Enforcement Section and the Enforcement Technology Project Group.  Texas plays a leadership role as part of the group’s Enforcement Section.  

To date, sweep investigators have identified 91 investment-related matters as potentially fraudulent and opened more than 5 active investigations. Individual jurisdictions working as part of the task force are taking regulatory action to address these threats, issuing 15 cease and desist orders, eight caution letters, and have made 26 referrals to other regulatory agencies.

Texans are encouraged to report incidents of investment fraud to the Securities Board.  They can send inquiries and complaints to enforceinfo@ssb.texas.gov.

The State Securities Board is a state agency responsible for regulating the securities market in Texas.  It is a member of NASAA, the North American Securities Administrators Association, a membership organization of state, provincial, and territorial securities regulators in North America.

The NASAA update on task force efforts can be found here - https://www.nasaa.org/55141/nasaa-updates-covid-19-enforcement-task-force-actions/?qoid=current-headlines.