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Check Before You Invest

Search the Database

When it comes to protecting your hard-earned savings, you can never be too careful. Before working with a loan broker or investing with a broker-dealer or investment adviser, it’s important to do your homework. Listed below are databases you can use to check the licensing and registration of individuals and/or firms in the financial services industry. Taking time to do this research could save you in the long run and help you avoid falling victim to fraud.

 

As you conduct your searches, if an individual or firm does not appear in the database, call the New Mexico Regulation and Licensing Department, Securities Division at 1-800-704-5533.

Broker-Dealer Firms and Agents

Broker-Dealers are people or firms who buy and sell securities on their own behalf or on the behalf of their clients. Broker-Dealers are licensed through FINRA on the federal level and the New Mexico Securities Division on the state level. Using FINRA’s BrokerCheck® database, you can access the following information about broker-dealers:

  • Employment history for individual agents
  • List of exams individual agents have passed to become licensed
  • List of states the agent or firm is registered in
  • List of disclosures such as disciplinary action taken by a state regulator and/or FINRA, criminal charges or convictions, bankruptcies and consumer complaints against agent or firm

How to Search

  1. Go to FINRA’s BrokerCheck®
  2. Click on the blue “Start Search” button
  3. Read through the terms and conditions, check the box stating that you agree and click on the blue “Continue” button
  4. Type in the name of the agent or firm, select the corresponding “Broker” or “Brokerage Firm” button below and click on the blue “Start Search” button
  5. A list of search results will come up. Carefully read through the list as there may be multiple agents and/or firms with similar names. Click on the appropriate name to view the report.
  6. You will see a summary report for the agent or firm. To view the complete report, click on the blue “View Full PDF Report” button in the top right corner of the page.

Investment Adviser Firms

Investment Adviser Firms give investment advice and sell securities; investment adviser representatives are individuals who work for these firms. The SEC regulates firms managing more than $25 million in assets; all other firms are regulated by the New Mexico Securities Division. Using the SEC’s Investment Adviser Search, you can access the following information about investment adviser firms:

  • Registration application and status (i.e. approved, suspended, revoked)
  • List of disclosures such as disciplinary action taken by a state regulator and/or the SEC and criminal charges or convictions
  • List of states the firm is registered in

Using the search, you will also find the following information about the individual investment adviser representatives: customer complaints, criminal or regulatory disclosures, professional qualifications, exam information and employment history.

How to Search

  1. Go to the SEC’s Investment Adviser Search.
  2. Choose Investment Adviser Representative (IAR) to search for an individual or Investment Adviser Firm to search for a company
  3. For Investment Adviser Representative searches:
    • Type in the name of the individual or their CRD number if you know it.
    • A list of search results will come up. Carefully read through the list as there may be multiple representatives with similar names. Click on the appropriate name to view the report.
    • To view a full report, including a list of exams the IAR has taken and the states where they are registered to practice, click on “View Detailed Report” in the top right corner.
  4. For Investment Adviser Firm searches:
    • Type in the name of the firm and click on the grey “Go” button
    • A list of search results will come up. Carefully read through the list as there may be multiple firms with similar names. Click on the appropriate name to view the report.
    • You will see the application for registration with the firms responses listed in red text. On the left side of the page is a menu that allows you to jump to certain parts of the application. The following sections are important to look at: Registration Status: this page lists the status of the application (i.e. approved, suspended, revoked) as well as states the firm is registered in Part 1A Item 11 Disclosure Information: this page lists any disciplinary action taken by a state regulator and/or the SEC and criminal charges or convictions.
    • To view the complete application, click on “View All Pages” in the menu.

 

Financial Calculators

Please note: The tools listed below are for general guidance and estimation purposes only and do not guarantee future results.

Compounding Interest

Savings Goals Calculator: See how long it may take for you to reach your savings goal

Mind Your Finances – In Charge Education Foundation

Investing

Fund Analyzer: Compare expenses and details of mutual funds, exchange traded funds (ETFs) and exchange trade notes (ETNs)

FINRA Investor Education Foundation (Financial Industry Regulatory Authority)

Retirement

Retirement Income Calculator: Get an estimate of your income when you retire

Mind Your Finances – In Charge Education Foundation

Loan Calculators

Investing 101

Investing is essentially putting your money to work for you. You will earn or lose money based on the performance of what you invest in. While investing can be a great way to build your wealth, it’s important to know a few things before entering an investment opportunity:

 

  • What are my goals? You should know what your end goal is for investing before purchasing anything. For example, are you looking to save for retirement or do you want to make money fast? How much money are you willing to invest and what type of return are you hoping for? Your goals will influence the type of investment you enter in.

  • What is my risk tolerance level? Every investment carries some level of risk. Investments with a low risk will make small gains and losses while investments with a high risk stand to gain or lose higher amounts of money. Investors should consider how comfortable they are with smaller versus bigger losses and gains before entering an investment opportunity.

  • Is the investment registered and the person selling it licensed? In the state of New Mexico, all securities and the people who sell them must be licensed and registered with the New Mexico Regulation and Licensing Department, Securities Division. Use the searchable database or contact the Securities Division to make sure everything checks out before you enter an investment.

 

It’s a time-tested truth that education is the key to success in nearly all areas of life—including investing. Consumers that make informed investment choices are significantly less likely to fall victim to fraud, and in turn, less likely to lose their money in unsound investments.

Investor Bill of Rights

When You Invest, You Have the Right to:

  • Ask for and receive information from a firm about the work history and background of the person handling your account, as well as information about the firm itself.
  • Receive complete information about the risks, obligations, and costs of any investment before investing.
  • Receive recommendations consistent with your financial needs and investment objectives.
  • Receive a copy of all completed account forms and agreements.
  • Receive account statements that are accurate and understandable.
  • Understand the terms and conditions of transactions you undertake.
  • Access your funds in a timely manner and receive information about any restrictions or limitations on access.
  • Discuss account problems with the branch manager or compliance department of the firm and receive prompt attention to and fair consideration of your concerns.
  • Receive complete information about commissions, sales charges, maintenance or service charges, transaction or redemption fees, and penalties.
  • Contact the New Mexico Securities Division in order to verify the employment and disciplinary history of a securities salesperson and the salesperson`s firm; find out if the investment is permitted to be sold; or file a complaint.
Glossary of Investment Terms

401 (k)

A 401(k) is a type of retirement plan that allows employees to save and invest for their own retirement. Through a 401(k), you can authorize your employer to deduct a certain amount of money from your paycheck before taxes are calculated, and to invest it in the 401(k) plan. Your money is invested in investment options that you choose from the ones offered through your company’s plan. The federal government established the 401(k) in 1981 with special tax advantages, to encourage people to prepare for retirement. They get their catchy name from the section of the Internal Revenue Code which established them (you guessed it, section 401(k)).

Affinity fraud

A name for a type of scam that targets members of a specific demographic group. Perpetrators may attempt to relate to or exploit characteristics common to the demographic group. Targeted groups can include the elderly, ethnic groups, and religions. Perpetrators attempt to portray themselves as members of this group or people who can relate to the members of the group in order to gain trust and eventually money. Ponzi schemes and pyramid schemes are sometimes combined with affinity fraud.

Annuity

A specified income payable at stated intervals for a fixed or a contingent period, often for the recipient’s life, in consideration of a stipulated premium paid either in prior installment payments or in a single payment. Dictionary.com

Bond

A long-term promissory note in which the issuer agrees to pay the owner the amount of the face value on a future date and to pay interest at a specified rate at regular intervals. NASD.com

Broker-dealer

A firm that functions both as a broker by bringing buyers and sellers together and as a dealer by taking positions of its own in selected securities. Many firms that are commonly called brokers or brokerage firms are actually broker-dealers. Wall Street Words: An A to Z Guide to Investment Terms for Today’s Investor by David L. Scott. Copyright ©2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company.

Convertible bond

A bond that can be exchanged at the option of the holder into preferred or common stock at a preset ratio. NASD.com

Equity-indexed annuity

A contract with an insurance company that promises periodic payments keyed in a specific manner to a stock market index. Unlike variable annuities, equity-indexed annuities specify a guaranteed minimum return that is typically 3 percent. These contracts may also specify an upper limit (cap) on the return that is paid. Indexing methods vary, and surrender charges often apply to early withdrawals. Wall Street Words: An A to Z Guide to Investment Terms for Today’s Investor by David L. Scott. Copyright ©2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company .

Fraud

A false representation of a matter of fact that should have been disclosed, which deceives another so that he/she acts upon it to his/her injury. NASD.com

IRA

Individual Retirement Account. An investment account in which a person can set aside income up to a specified amount each year and usually deduct the contributions from taxable income, with the contributions and interest being tax-deferred until retirement. Dictionary.com

Identity theft

The fraudulent appropriation and use of someone’s identifying or personal data or documents such as a credit card. Dictionary.com

Investment

The investing of money or capital in order to gain profitable returns, as interest, income or appreciation in value. Dictionary.com

Mutual fund

An investment company that issues shares continuously and is obligated to repurchase them from shareholders on demand. Dictionary.com

Phishing scams

Phishing is a high-tech scam that uses spam email to deceive consumers into disclosing their credit card numbers, bank account information, Social Security numbers, passwords, and other sensitive personal information.

Ponzi schemes

An illegal investment scheme in which investors are promised impossibly high returns on their investments. These are scams in which money from later investors is used to pay earlier investors. The creators of the scheme get most of the profits while those who come later are left with nothing because there are eventually an insufficient number of new investors to pay the existing ones. These scams inevitably collapse because they require exponential growth in the number of participants at each step, which is impossible. Letters or emails that encourage the recipient to send money and then pass the message along to a certain number of new targets are a type of pyramid scheme.

Promissory note

A written promise to pay a specified sum of money to a designated person or to his or her order, or to the bearer of the note, at a fixed time or on demand. Dictionary.com

Roth IRA

An individual retirement account in which investments are made with taxable dollars, but earnings are tax-free and withdrawals are tax-free after age 59 ½. Dictionary.com

Variable annuity

An annuity in which the premiums are invested chiefly in common stocks or other securities, the annuitant receiving payments based on the yield of the investments instead of in fixed amounts. Dictionary.com

Variable life insurance

An insurance policy whose annuity payments or payment to the beneficiary are not fixed but depend on the income earned by the investment of the premiums. Dictionary.com

Viatical Investments

The purchase of an interest in a terminally ill person’s life insurance policy for a certain percentage of the policy’s face value.
Request a Presentation

One of the most effective forms of consumer protection is education. The New Mexico Securities Division gives presentations and participates in outreach events across the state to help New Mexicans learn about smart investing strategies and how to avoid falling victim to fraud. The Consumer Protection and Investor Education Program is a proactive approach to law enforcement. While the New Mexico Regulation and Licensing, Securities Division enforces securities laws and brings those who break them to justice, consumer protection and investor education gives New Mexicans the opportunity to become more aware of how to avoid fraud and be smart, safe investors. This unique approach help New Mexicans be proactive with their financial decisions rather than reacting after the problem has occurred.

 

The Securities Division provides presentations and materials that are available free of charge. The program is not funded by taxpayer dollars, but rather by money collected from settlements in securities fraud cases litigated by the New Mexico Regulation and Licensing, Securities Division.

 

    To request a presentation in your area or to have our office present at an information fair or expo, please contact the New Mexico Regulation and Licensing Department, Securities Division, at 800-704-5533 or andrea.brown@rld.nm.gov.

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