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Nevada Secretary of State’s Office proposes new fund for victims of fraud

Houston and Aguilar, dressed in business clothing, sitting at a table with microphones pointing toward them. Both are looking at someone speaking to them off-camera.
Lucia Starbuck
KUNR Public Radio
Nevada Deputy Secretary of State for Securities Erin Houston (left) and Secretary of State Cisco Aguilar present AB67 to create a fund for victims of securities fraud during an Assembly Committee on Judiciary meeting in Carson City, Nev. on Feb. 21, 2023.

The Nevada Secretary of State’s Office has proposed creating a fund for victims of fraud, such as pyramid schemes and cryptocurrency scams.

Assembly Bill 67 would establish a restitution fund for victims of securities fraud. During Tuesday’s Assembly Committee on Judiciary meeting, Nevada Deputy Secretary of State for Securities Erin Houston explained what types are most common.

“Securities fraud involves people who have lost their money to an investment scam, think Bernie Madoff, think pyramid scheme, or more commonly, just a person who uses fraudulent information in the offering for an investment,” Houston said.

Victims could receive up to $25,000 following a criminal conviction or civil judgment. Houston has seen people lose anywhere from a couple of thousand dollars to millions. Victims of crime are entitled to timely restitution under the Nevada state constitution, but it’s not always that easy for victims of fraud.

“Individuals who have defrauded Nevada investors often have no money left over to make their victims whole. Even if the victim receives a judgment in civil court, there is no money or assets left with which to collect,” Houston said.

Houston said her office receives four to 10 complaints per month but says there are likely more as people often don’t report these crimes. Houston said people should not feel ashamed. She also said seniors are the most vulnerable.

“I think seniors are more commonly victims of fraud because they may not be as savvy about specific types of fraud that are common, as fraud arises in different spaces like the crypto sphere, or where somebody thinks that they’re dealing with somebody who’s romantically interested in them, and seniors may be more lonely,” Houston said.

Houston hopes the fund will give fraud victims hope and help break down the stigma of reporting complaints.

“This will help get people back on their feet, give them an opportunity to look forward and continue to build an investment portfolio, so they can live a comfortable life in the long term,” said Democratic Secretary of State Cisco Aguilar.

Investors are asked to be cautious and be on the lookout for red flags, such as being pressed for money immediately or if something is too good to be true.

Lucia Starbuck is an award-winning political journalist and the host of KUNR’s monthly show Purple Politics Nevada. She is passionate about reporting during election season, attending community events, and talking to people about the issues that matter most to them.
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