Too good to be true? Lindeen warns of Ponzi schemes

csimt Uncategorized

HELENA, Mont. — Montana Commissioner of Securities and Insurance Monica Lindeen warns Montanans to be cautious of Ponzi Schemes today, an infamous day in the history of financial scam artists.

March 3 is the birthday of Charles Ponzi, the pioneer of the con that defrauded investors out of millions of dollars in the 1920s. Ponzi Schemes continue to resurface around the world and in Montana.


“As the financial world gets more complex, con artists continue to find victims in Montana,” Lindeen said. “It’s worth repeating: If you are offered an investment that sounds too good to be true, it probably is.”

In Ponzi schemes, the fraudsters typically promise investors unrealistic payouts with little or no risk. They use the money from new investors to make promised payments to earlier investors, creating the false appearance that investors are profiting from legitimate investments.

Invariably, the scam collapses when the con artist runs out of investors to keep the funds flowing. But by then the money is often gone and unrecoverable.

The State Auditor’s Office has shut down several Ponzi schemes in Montana that have swindled investors of millions dollars, and has several more cases currently under investigation.

There are ways to protect yourself.

  • Check with the Office of the Montana State Auditor, Commissioner of Securities and Insurance to verify the investment opportunity and sales person is registered with our office before you invest.
  • Talk with your attorney or family before investing.
  • Monitor your investments and ask tough questions.
  • Insist on regular written reports and look for signs of excessive or unauthorized trading on your account.

The Office of the Montana State Auditor, Commissioner of Securities regulates the securities industry in Montana. We protect your investments by requiring anyone selling securities in Montana  to be in compliance with the Securities Act of Montana and investigate any complaints of fraud or improper practices.

People considering any investment should confirm the person or firm offering is properly licensed by the Office of the Montana State Auditor. If you suspect you are a victim of a scheme, call us at 800-332-6348.