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FINRA and FINRA Foundation Protect Seniors from Investment Fraud, Help Military Save for Future

The FINRA Investor Education Foundation devoted significant resources in 2008 to helping two vulnerable and often under-served groups weather the current financial and economic crisis the nation’s seniors and U.S. military service personnel (see also Financial Industry Regulatory Authority FINRA).

The FINRA Foundation launched a campaign last April in Florida and Washington State to help seniors identify and resist persuasion tactics common to many types of fraud. The centerpiece of the Foundation s campaign to protect seniors is a 90-minute intensive workshop Outsmarting Investment Fraud. Follow-up surveys indicated that, for those who attended the workshop, responsiveness to fraud appeals was reduced by over 50 percent. The Foundation, which partnered with AARP, the Florida Office of Financial Regulation and the Washington Department of Financial Institutions to present the Outsmarting Investment Fraud program to seniors, will expand its fraud-fighting campaign to three additional states in 2009.

Fraudsters are taking advantage of the current economic turmoil to ensnare new victims. And we are working to provide the investing public with the tools and resources they need to protect themselves and their families, said John Gannon, President of the FINRA Foundation and FINRA s Senior Vice President for Investor Education. FINRA and the FINRA Foundation are dedicated to protecting America s seniors from investment frauds that can wipe out their life s savings and to helping military service members stay away from predatory loans and save for their future.

In 2008, FINRA continued its strong support of the FINRA Foundation by donating $5 million to support the Foundation s efforts to provide educational resources and training to at-risk and under-served segments of the investing public. The FINRA Foundation, which is the U.S.’s largest foundation devoted to investor education, has received $30 million in cash from FINRA since its inception in 2004. The Foundation has received an additional $7.2 million in fines from FINRA enforcement settlements and $55 million from the Global Research Analyst Settlement. Since 2004, the Foundation has approved more than $16 million in grants and devoted an additional $23 million to direct investor education. Military Families The FINRA Foundation conducted 21 financial education forums in 2008 at military installations across the country, including Camp Pendleton, CA; the Naval Station Great Lakes, IL; and Fort Gordon, GA. These forums provide servicemembers with tools and resources to manage credit responsibly, avoid predatory loans and save for their future. Since the Foundation began conducting these forums in early 2006, it has reached more than 16,000 servicemembers and their families at 68 forums in 39 locations throughout the world and at sea. In 2008, the Foundation s military financial forums reached more than 8,000 uniformed personnel exceeding the numbers for 2006 and 2007 combined.

The Foundation awarded 189 military spouses with fellowships to fund the education necessary to earn the Accredited Financial Counselor ® designation and to provide financial counseling and education within the military community. These military spouses commit to working or volunteering for up to two years in the financial counseling field serving the military. Military spouses who work and volunteer as financial counselors can draw on their own experiences to help other military families, while at the same time building a rewarding career that is flexible enough to conform to the demands of the military family lifestyle.

The Foundation has also made BrightScore ®, an online credit management tool, available free of charge to over 45,000 active duty military personnel and their spouses to help them manage their credit wisely. By using BrightScore ® tens of thousands of military families have received a detailed analysis of their credit history and score and a personalized action plan to help improve their credit. Nearly three-quarters of those scoring 620 or below who took advantage of the opportunity to pull their scores again improved their credit scores. Libraries SmartInvesting@yourlibrary ® is a community-based grant program launched with FINRA Foundation funding in 2008 to build the capacity of U.S. public libraries to provide financial education resources and services to library patrons. These libraries, which reach urban, suburban and rural communities, are helping new investors avoid costly mistakes, while also providing savvy investors with the detailed information they need. In the coming year, 25 libraries and library networks, serving more than 8 million people, will participate in Smartinvesting@yourlibrary ®. SaveAndInvest.org The FINRA Foundation maintains military- and senior-oriented pages on its Web site, www.SaveAndInvest.org. SaveAndInvest.org s military pages help military families budget, save for retirement and avoid predatory loans. SaveAndInvest.org s senior-oriented pages contain an array of financial education material from FINRA as well as from other organizations with expertise in helping seniors avoid falling victim to fraud. SaveAndInvest.org receives nearly 23,000 visitors per month. Investor Alerts FINRA s Investor Alerts provided with unbiased information they needed to make smarter investment choices during a very difficult year in the markets, including two alerts issued during the financial crisis, If a Brokerage Firm Closes Its Doors and Treasury’s Guarantee Program for Money Market Mutual Funds: What You Should Know. Earlier in 2008, FINRA also warned seniors of the perils of reverse mortgages, the dangers posed by 401(k) debit cards and Advanced-Fee scams. Fund Analyzer In late 2008, FINRA launched the Fund Analyzer, which combined the capabilities of FINRA’s Mutual Fund Expense Analyzer and Mutual Fund Breakpoint Search Tool, to help investors and brokers compare and evaluate the cost of investment options. The Fund Analyzer allows investors to search and compare up to three funds at once for fund analysis and information about fees and potential breakpoints (volume discounts applied to sales charges for investors who purchase front-end load mutual fund shares).

FINRA, the Financial Industry Regulatory Authority, is the largest non-governmental regulator for all securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through effective and efficient regulation. FINRA registers and educates industry participants, examines securities firms; writes and enforces rules and federal securities laws, educates the investing public and provides trade reporting and other industry utilities. FINRA also administers the largest dispute resolution forum for investors and registered firms. For more information, please visit our Web site at www.finra.org.

Source: knowledgeplex

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