By Jessica L. Mackaness, Esq.  of Shustak Reynolds & Partners, P.C. posted on Friday, August 5, 2016.

Jessica L. Mackaness

Senior Associate

The craze of online dating and mobile dating apps has swept the nation. According to recent polls, of the estimated 54 million American singles, nearly 50 million have tried online dating. But despite its growing popularity, there are certain risks that come with this new style of dating, including safety concerns, loss of privacy, and the potential of being “catfished.” But now there’s an additional risk that may not automatically come to mind when you think of online dating: investment fraud. 

The U.S. Securities and Exchange Commission (SEC) recently announced fraud charges and an asset freeze against a Connecticut man who is accused of defrauding investors–including six women he met through online dating websites  The SEC's complaint alleges that he persuaded these women, their family members and friends, and more than 30 other people, to invest in his company, claiming it was on the verge of closing deals that would bring large payouts to investors. However, according to the complaint, there were no such deals, and the man allegedly used the money for personal expenses, including $20,000 for an engagement ring for his most recent online sweetheart.  In addition, according to the SEC complaint, he did not follow the federal securities laws in making the offer, and was not registered to sell investments.

So, as always, be sure to do some checking before you trust someone with your money (and your heart). 

Shustak Reynolds & Partners, P.C.’s San Diego FINRA and SEC attorneys have extensive experience representing high-net-worth investors, registered representatives and investment advisors in a variety of securities-industry matters, including FINRA and SEC inquiries and enforcement proceedings. Contact us today for a confidential consultation.

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