Private Security Scams

By:  Jennifer Bachelor


The sale of private securities has increased significantly over the last decade.  Legitimate private securities may provide increased portfolio diversification and returns. Unfortunately, this has also given rise to fraudulent security schemes.  Investors need to be aware, so they do not fall victim to such scams.

Private security offerings do not have to register with the Securities Exchange Commission if they meet minimum guidelines.  They are not held to the same scrutiny as public offerings.  Advisors and brokers can sell private, unregistered securities to clients with a net worth of at least $1 million or income of $200,000 annually, but agents on the outside of the financial industry are not as well supervised and held to the same standards.  It is difficult to identify private security scams because the agents that sell them (insurance agents or former stockbrokers, for example) are not under the supervision of the Financial Industry Regulatory Authority Inc.

Scams go unnoticed until an investor files a complaint with a regulator and an investigation commences.

Additionally, in the past, private securities were sold over the phone or via seminars primarily, but the internet and social media have given scam artists a platform to heavily advertise their investment scams and promises of exciting investment returns to anyone willing to click.  They prey upon senior citizens, inexperienced investors, and those without financial advisors.  Sadly, these are often people who cannot afford to lose their initial investment.

Unscrupulous registered brokers can also sell fraudulent private securities using a type of transaction called “selling away”.  This involves the representative requesting the client to move money from their brokerage account (TD Ameritrade, for example) to their bank account. Then the investment is made from the client’s bank account.  This makes it difficult for the broker-dealer firm to supervise.

Here at Homrich Berg, we may alert you to opportunities in private funds occasionally.  Those opportunities are reviewed rigorously by our investment department, and we do not receive any commissions on any sales.  The investment management fees are the same as if you were invested in a stock, bond, mutual fund, etc.  The investment purchase is made directly from your brokerage account.  You may hear about private security offerings from your friends.  Be sure to run them past your client manager for review before investing.

The sale of private securities will likely continue to grow.  Legitimate private securities provide wealthy investors with additional diversification and investment opportunity.  Just be aware that not all private security offerings are legitimate.

To find out more, go to

Kevin Kraus

Your Safe Travel Cyber Checklist

By: Kevin Kraus


Do you have your summer travels planned yet? As you prepare for the fun part of summer travels, we want to remind you that while you’re away, cybercriminals will prey. Below is your safe travel cyber checklist.

Don’t use social media to advertise your travel plans. We maintain a strict policy with our kids when we travel that they are not allowed to post pictures, itineraries, or other travel related information on any social media site until we return from our trip. It is just too easy for cyber criminals to stalk social media and find out that you will be in South Africa for two weeks and use the opportunity to break into your home.

Be wary of public Wi-Fi. I am sure you are tired of continually hearing this, but I find it continues to be violated especially when overseas. Remember, the hotel’s Wi-Fi, Starbucks, or any other public Wi-Fi is not safe. I would recommend you sign up for your phone carrier’s travel plan and only use your phone’s personal Hot-Spot. If you must use any external network while traveling, do not ever log-in to check your bank or brokerage balances (including PayPal) or log into any other financially sensitive site. If you mistakenly do, be sure to change log-in names and passwords immediately.

Watch where you get your cash. Here again, the risk seems to be greater overseas although ATM thieves are getting increasingly more brazen here in the States. An ATM machine is a great place for identity thieves to gain access to your banking information. We always recommend that you use a bank ATM whenever possible as they tend to be more secure. If traveling abroad, it is best to get some cash up front so you are not scrambling to get cash when arriving and make the mistake of using easily hacked ATM machines. Also, when traveling overseas, I maintain an account at a bank different from my regular bank where I will deposit enough cash to cover my expected cash needs while traveling and will only use that ATM card. If I get hacked, all that is “at risk” is the amount of cash I expected to need and not my entire checking and savings balance.

Turn off your home computer. Many of us might leave our computers on as a habit, but leaving it on makes the computer more susceptible to hacking.

Protect the home. We suggest you contact your home alarm provider to let them know the house will be vacant and ask if they offer a home encryption tool. You should also consider disconnecting the garage door opener and locking it manually to protect it from thieves who can easily break the code. Finally, unplug any devices which are connected to the internet.


5 Tips For Keeping Your Digital Life Secure

By: Shawn Ayton


Keeping up with computer security can be a daunting and overwhelming task. My goal in this post is to outline five things I think are essential in order to keep your digital life secure.

  1.   Configure all of your computers to automatically download and install operating system updates. 

The steps for setting up automatic updates vary slightly based on your computer system (e.g. Windows 7, Window 10, Mac OS, etc.).  Fortunately, you can Google how to enable automatic updates for your specific system.  For example, here are two links with instructions on how to enable automatic updates for Windows 10 and Mac OS.

   2.   Install antivirus software. 

Windows 10 comes pre-loaded with Windows Defender, Microsoft’s built-in antivirus program that works really well. I recommend Sophos Antivirus for Mac. Sophos continues to be recognized as one of the best antivirus solutions for Macs.

  3.   TREAT ALL EMAILS YOU RECEIVE AS A PHISHING EMAIL until you can verify its authenticity. 

A phishing email is an email sent by a fraudster/hacker that appears to come from a legitimate company (e.g. your financial institution) asking you to provide sensitive information (e.g. your username or password) or asking you to click on a malicious link or attachment with the goal of stealing your financial assets.  It’s estimated that 75-85% of all cyber attacks start by getting the victim to perform an action in a phishing email.  Use these steps to verify each email you receive:

  • Verify senders email address ( vs
  • Hover over links in emails to verify the destination (be careful to note the spelling of the domain name). For example, vs
  • Ask you yourself. Were you expecting the email?  Is the email part of an outgoing conversation?  Do you know the sender?  Is there anything suspicious about the email and request?  Keep in mind that the sender’s email account may have been hacked.
  • Be suspicious of ALL emails that request that you click on a link or open an attachment.
  • If you are uncertain if a link or attachment is malicious, contact the sender by phone or text.
  • Many phishing emails purport to be from DocuSign, Dropbox, and other popular online services – be careful.

      4.   Turn on two-factor authentication on all online services that support it.  

Two-factor authentication requires you to enter a code or approve the connection from an app after you have entered your username and password.  This is the best way to safeguard your online access because it prevents a fraudster/hacker from accessing your account with merely your username and password.  Contact your online service provider for help setting up two-factor authentication.

      5.   Monitor your Phone Calls/Text/Social Media. 

Fraudsters are also using these avenues to trick people into providing sensitive information.  Be careful about what information you provide through these services.

Remember, if you suspect that your account has been hacked, change your password immediately and contact the service provider.