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Secretary of State

Securities Division > News Archive  > 2007 Press Releases > For Immediate Release: February 20, 2007 Rokita warns investors against slippery oil and gas deals

Contact: Jen Fanger
317-233-8655
Media@sos.in.gov

Indianapolis, IN - Although oil prices have fallen since reaching an all-time high last summer, fraudulent oil and gas deals remain a favorite ploy of con artists nationwide, cautions Indiana Secretary of State Todd Rokita, the state's chief securities enforcement officer.

"There are legitimate oil and gas ventures out there that can be wise investments for those who understand and can afford the risk," said Rokita. "But there are also doubtful and even outright fraudulent energy deals promoted to the public, which underscores the importance of investigating before investing."

Skyrocketing prices of oil and natural gas in recent years have made a variety of traditional and alternative energy projects attractive to investors, but scam artists are often keenly aware of this too, and frequently use current events as a way to pull investors into fraudulent deals.

Businesses raising money by soliciting investors must comply with Indiana's securities laws. Scam artists tend to target individual victims and make an unsolicited contact, usually with a phone call, offering a "great" business opportunity.

The Securities Division of the Indiana Secretary of State's Office, along with its membership organization, the North American Securities Administrators Association (NASAA), have issued an alert to investors who may be considering oil and gas opportunities.

Most fraud victims don't realize they have been swindled until after the money is gone. "As with any investment, investors should independently research the background of the promoters, get a clear explanation of the deal in writing, and carefully read all the fine print," said Rokita. "Scam artists usually tell prospective victims that they are licensed and their investment is registered - and they can be quite convincing."

The Securities Division can tell potential investors whether an individual and his or her company are licensed to sell securities in Indiana and whether they have a history of disciplinary action. Investors can also find this information by visiting www.IndianaInvestmentWatch.com.

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