Securities Bulletin

              SECURITIES bulletin
“Be aware of Hurricane
Katrina-related scams”
In the aftermath of the devastating
hurricanes that pummeled the Gulf Coast,
the public should beware of emerging
investment scams. Unfortunately, when
tragedy strikes, there are those who attempt
to take advantage of the situation and its
victims. I want to ensure that investors and
others who want to help the victims are not
throwing away their hard-earned money.
Scam artists may use telephone sales,
advertisements or Internet postings touting
investment pools or bonds to help
hurricane victims. They also may advertise
supposed water removal or purification
technologies and electricity-generating
devices. These ads should be a red flag.
Investors also should beware of oil and gas
scams in the wake of rising gas prices.
In the world of investing, if it sounds too
good to be true, it probably is. I encourage
investors to check out potential investments
by calling the Securities Department at 800-
628-7937. Following are a few tips to help
investors avoid loss:
• Hang up on cold callers.
• Beware of e-mail or Internet messages
discussing small companies with new
hurricane-related
technologies or
products.
• Use common sense. If
the profits sound too
good to be true, it
probably is a scam.
Jesse White
Secretary of State
Fall 2005
The Illinois Securities Department's Enforcement Division was an
integral part of four successful cases this summer in which several
men were convicted and/or sentenced as a result of securities fraud.
Damon case — Douglas Damon was sentenced July 29 to 56
months in prison and ordered to pay $465,415 in restitution to his
victims for devising to defraud in violation of the U.S. Code.
Damon was president of Rothchild Leasing Services, Inc., in
Chicago, where he sold promissory notes to investors promising an
11 percent rate of return. He provided fraudulent documents to
investors with false representation about his company.
Devine case — Frank Devine pleaded guilty July 26 to one count
of devising to defraud. He told investors that they would earn high
rates of return with little risk and bilked 80 individuals out of $4.8
million. Devine returned a portion of the money in an attempt to
conceal the scheme. He will be sentenced in January.
(cont. on page 4)
Securities Department integral in
prosecution of recent fraud cases
IN
THIS
ISSUE
• SECURITIES DEPARTMENT INTEGRAL IN PROSECUTION OF FRAUD CASES •
• FAQ: REGULATORY AGENCIES •
• INVESTMENT ADVISER INFORMATION FOR CONSUMERS •
• ENFORCEMENT ADMINISTRATIVE ORDERS •
• KEY FILING DATES FOR 2006 •
A NEWSLETTER OF THE ILLINOIS SECURITIES DEPARTMENT • SECRETARY OF STATE JESSE WHITE
Ministers’ Summit on Consumer Protection — Secretary of State Jesse White and
Attorney General Lisa Madigan joined Malcolm X College President Zerrie Campbell
(right) for the Ministers’ Summit on Consumer Protection at the college on Sept. 20. The
summit brought together Chicago area church leaders to discuss affinity fraud and
services both offices provide to protect Illinois consumers against fraud. White and
Madigan also presented their message the following day to Chicago's south side church
leaders at the Fellowship Baptist Church.