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Beware of BP Oil Spill Scams

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By Admin on June 02, 2010 12:45 PM

Any high-profile tragic situation often leads to scammers who look to take advantage of the situation. After the recent warnings from The Financial Industry Regulatory Authority and the Securities and Exchange Commission, consumers would be wise to be skeptical of any organizations who claim to be assisting with the BP oil spill cleanup. Possible oil spill scams could include requests for donations to fake organizations, investment schemes, or other methods to gain information or money.

Certainly, there are plenty of organizations in the Gulf doing legitimate, noble work, however, the FINRA and SEC have seen enough of a surge in oil spill scam activity that it is important to be vigilant.

A recent Consumer Reports article highlighted a government press release:

"While some of the companies touting their role in the cleanup may be legitimate, others could be bogus operations that are only looking to clean out unsuspecting investors."

Take for example, a company that the SEC recently suspended trading shares of, ACT Clean Technologies, Inc. The agency became suspicious of ACT's "oil fluidizer." It would be hard to blame the SEC on that move; the term "oil fluidizer," has a fairly dubious sound to it.

The SEC and FINRA have suggested investors be especially skeptical of the following types of claims:

  • Products or technologies effective in remediating oil spills or restoring the ecosystem,
  • contracts or expected contracts with BP,
  • technical expertise provided to BP or government agencies such as the Environmental Protection Agency,
  • quick, exponential sales growth.

With a little vigilance, you can make sure that your time and money only go to the good guys.

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