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Fraud costs Utahns $1 billion

Posted - Jun. 3, 2010 at 5:16 p.m.



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SALT LAKE CITY -- Investigators chasing down security fraud in Utah released a stunning statistic Thursday: $1 billion. According to the Utah Securities Fraud Task Force, that number represents the total losses in recent years to fraud.

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The Utah Securities Task Force is made up of nearly a dozen state and federal agencies. The inter-agency group is ramping up a new campaign aimed at stemming the tide of security fraud.

The task force is currently investigating more than 100 fraud cases.

A recent analysis showed there are 4,400 victims who lost about $1.4 billion to fraud. The task force identified 370 perpetrators in those cases.

Ponzi schemes are popular in Utah, at least in part because of affinity fraud -- when a con artist preys on a group of people who share a common bond, like religion or shared interests. One victim says that's how she was victimized.

Research before you invest
Get tips, warnings, and confirm a promoter or firm is licensed and the product is registered by using the SEC's websites and the Utah Division of Securities website:

"This man had all of the right words, and he knew exactly what I wanted to hear," a woman named Kaylene said. "He played on my every emotion. He was slick, and he was sly, and he knew exactly what he was saying."

"We have zero tolerance for crime, including white-collar crime," Gov. Gary Herbert said Thursday. "These kinds of frauds are things that we will not tolerate. We are going to be aggressive. We're going to be proactive. We're going to make sure the public is aware."

The effort includes a billboard campaign, public service announcements, a fraud seminar later this month and new information on the web.

The task force says its best advice to avoid becoming a victim is:

  • Research before you invest
  • Get tips and warnings
  • Check if a firm or product is licensed or registered with the SEC or the state

If you suspect fraud, authorities urge you to report to your local law enforcement agency.

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Story compiled with contributions from John Daley and Paul Nelson.

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