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News Release: 01-09
GRAY DAVIS, Governor
Date: 03/28/01
DEMETRIOS A. BOUTRIS, Commissioner
California Picks Up Where Feds Leave Off on Fighting Fraud
Over 2,000 Enforcement Actions Expected This Year
Sacramento, May 2, 2001 — The California Department of Corporations today announced that it will compensate for the potential drop in federal enforcement actions against fraudulent broker-dealers as a result of Securities and Exchange Commission staff cuts necessitated by the Bush Administration’s budget plan.
In the budget proposal submitted by the Bush Administration, the SEC would be required to cut 57 authorized staff positions, 12 of which are related to the prevention and suppression of fraud.
"Scam artists need to understand that California is not the place they want to do business," said Corporations Commissioner Demetrios A. Boutris. "The California Department of Corporations has investigators going undercover everywhere from investor conferences to Internet chat rooms to find fraudulent operators and shut them down."
"Fraud perpetrators in California have been 40 times more likely to run into the California Department of Corporations than the SEC," added the Commissioner. "The Davis Administration wants California’s investors to understand that regardless of what is happening at the national level, here in California we are working around the clock to protect the integrity of the financial marketplace."
The Department of Corporations is California's Investment and Financing Authority, reporting to the Business, Transportation and Housing Agency and the Governor. The Department is responsible for the regulation, enforcement and licensing of securities, franchises, off-exchange commodities, investment and financial services, independent escrows, consumer and commercial finance lending and residential mortgage lending. For further information or to obtain a complaint form, see the Department's Web site at www.corp.ca.gov.
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