The SEC’s Office of Investor Education and Advocacy (OIEA) and Broker-Dealer Task Force issued an investor alert  this summer warning the more than 5 million Thrift Savings Plan (TSP) participants, and investors in other federal government employee retirement plans, that investment scam artists may pretend to be affiliated with a government agency.
Legitimate companies will mention they aren’t affiliated with the government on their website, blog, email or mailed flyer. I advise site visitors on our about  and contact pages that we are not affiliated with any federal entity and that is sound business practices. I further advise our site visitors and email newsletter subscribers to check with their personnel office or with OPM for retirees because benefit and TSP rules and regulations or processes change.
According to the SEC, “Federal government agencies, including the SEC, do not endorse or sponsor any particular securities, issuers, products, services, professional credentials, firms, or individuals.”
If someone offers you an investment opportunity and claims any affiliation with the federal government, the SEC suggests that you follow these tips:
- Do not trust any contact information or a website provided by someone contacting you with an investment idea when that person claims to be affiliated with the government, the TSP, or government retirement plans.
- According to the agency that administers the TSP, the TSP will never contact you by email, telephone, or mail asking you to provide sensitive personal information such as your account number, Social Security number, password, or PIN.
- You can confirm that a seller is not affiliated with a government agency by contacting the agency directly or calling the SEC’s toll-free investor assistance line at (800) 732-0330.
- Always be cautious about providing personal information to anyone you do not personally know.
It goes without saying that the above tips apply in most situations. For example, I receive many unsolicited calls both personal and for business, and I’m put on alert the minute they ask for personal information. I refuse to provide any personal information unless I have an established relationship with them and even then I’m cautious.
I receive many solicitations by phone asking for contributions and I’m sure some of the calls, if not the majority, actually come from a valid charity or political party. Even if I’ve given them funds in the past, such as any of the major charities, I refuse to contribute to their cause over the phone. How does anyone know who is really on the other end of the call. If I decide to contribute I ask them to send their request through the mail. When I receive the mailing I can then check to ensure it has come from a legitimate source.
The SEC recently brought an enforcement action against a group that fraudulently induced federal employees to roll over funds from their TSP accounts into privately issued variable annuities. The defendants allegedly failed to disclose that this “option” involved investing with a third party that had no government affiliation.
Online Data Breaches (Caution)
Today we must proceed with caution for many reasons. Recently, the credit reporting firm Equifax reported a major data breach that could potentially affect 143 million US consumers. Considering that the population of the United States is around 324 million this data breach could end up affecting 44 percent of the population!
Equifax reported the data included names, birth dates, Social Security numbers, addresses and some driver’s license numbers! As many as 209,000 U.S. credit card numbers were also obtained, in addition to certain other information for approximately 182,000 U.S. consumers.
It seems that computer system security breaches are commonplace today to the point that when we hear about them it’s almost matter of fact. These security failures can put our finances at risk and there are things we can all do to protect ourselves short of cutting the automation cord altogether. I’ve often commented on the fact that we are all too connected today and reliant on automation.
I’ve started to change all of our passwords, and there are many. Passwords for our bank and investment accounts, first and foremost. I’m reviewing our bank, credit card, and investment reports closely looking for anomalies, small unrecognized transactions that would normally be passed over during a review.
Many think of account security breaches as events where the criminals wipe out your account overnight and you wake up BROKE! That isn’t generally the case. What I understand happens is the culprits review your account and look for average charges. For example, if your average charge is $35 they process one or two each month for that amount realizing we are all busy and generally won’t notice the small average charges. If they do this to 1 million accounts just think of the huge amount they collect monthly! Review your account statements and if you suspect anything call the credit card company immediately and have them send out a new card and deactivate the old number.
There are a number of excellent articles out there on how to protect yourself including Your Guide to Surviving the Equifax Data Breach  (CNET). It provides a five step process to follow.
Request a Federal Retirement Report™  today to review your projected annuity payments, income verses expenses, FEGLI, and TSP projections.
Helpful Retirement Planning Tools
Distribute these FREE tools to others that are planning their retirement
- Retirement Planning Guide 
- Federal Employee’s Health Benefits (FEHB) 
- Medicare – Information 
- Master Retiree Contact List  (Important contact numbers and information)
- 2017 Leave and Schedule Chart  (Excel chart tracks all leave balances. Use this chart to set target retirement dates.)
- 2017 Annuity Calculator (FREE Excel chart estimates annuity growth)
Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that retirees, potential and existing investors conduct thorough investment and benefit research of their own, including detailed review of OPM guidance for benefit issues and for investments the companies’ SEC filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.
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