Nebraska Department of Banking and Finance

News & Publications

CONSUMER ALERT

Publication Date: Sep 15, 2017

NDBF ISSUES BINARY OPTIONS ADVISORY

SEPTEMBER 15, 2017 (LINCOLN, NEB.) — A binary option is a type of all-or-nothing investment contract, similar to placing a bet. Like the flip of a coin, there are only two possible outcomes: heads you win or tails you lose. When an investor purchases a binary option contract, the investor predicts the value of an underlying asset (currency, stock, etc.) at a predetermined time or date in the future – similar to placing a bet. If the investor correctly predicts the asset price at the end of the contract, which can be just a matter of minutes, the investor receives the payout agreed upon in the contract. If the investor is incorrect, there is no payout and the investor loses the amount invested in the binary option.

The Nebraska Department of Banking and Finance (“NDBF”) is cautioning investors about schemes related to binary options amid the proliferation of online binary option platforms and a growing number of related investor complaints. The advisory provides information and resources to help investors better understand binary options, their risks and where to turn for help.

The advisory also discusses common investor complaints and offers common tactics and warning signs of schemes related to binary options, including: unsolicited investment offers; high-pressure sales tactics; personal information requests; and a lack of information about the offering firm or its management.

The full advisory is available on the agency’s website at www.ndbf.nebraska.gov/about/news-publications.

Before making any financial decisions, ask questions, do your homework and contact NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

CONTACT: Claire McHenry, Deputy Director – Securities Bureau
PHONE: (402) 471-2171
EMAIL: claire.mchenry@nebraska.gov

Consumer Alert Binary Options

CONSUMER ALERT

Publication Date: Aug 31, 2017

Ohio Company Ordered to Stop Soliciting Investors

August 31, 2017 (Lincoln, Nebraska) – The Nebraska Department of Banking and Finance (“Department”) issued a Cease and Desist Order against an Ohio company known as A Voice 4 U, LLC; its President, Katrina S. Farmer (“Farmer”); and its affiliates, control persons, officers, directors, agents, and employees.  The Order prohibits the entity and individuals named from offering or selling securities in Nebraska until the securities have been registered with the Department. The Order also prohibits the entity and individuals named from offering or selling securities in Nebraska until they are registered as broker-dealers or agents of a broker-dealer with the Department.  

From 2012 to 2014, Farmer sold profit-sharing agreements in A Voice 4 U, LLC to investors in Nebraska. The profit-sharing agreements were not registered in Nebraska under the Securities Act of Nebraska. Neither A Voice 4 U, LLC nor Farmer were registered in Nebraska as a broker-dealer or agent of a broker-dealer.  The sale of unregistered securities and the solicitation of investments by unlicensed broker-dealers is illegal under Nebraska law.

Individuals who invested in the above securities are asked to contact the Department.

More information about the laws governing the securities industry in Nebraska can be found on the Department’s website at www.ndbf.nebraska.gov. If you have questions about any investment matters, call the Department’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

CONTACT: Thomas A. Sindelar, Investigation Supervisor
PHONE: (402) 471-2171
EMAIL: thomas.sindelar@nebraska.gov 

A Voice 4 U C&D
A Voice 4 U Consumer Alert

Hurricane Harvey Consumer Alert

Publication Date: Aug 31, 2017

NDBF Cautions Investors to Watch for Scams in Wake of Hurricane Harvey

AUGUST 31, 2017 (Lincoln, Neb.)  —  In the wake of widespread damage caused by Hurricane Harvey in Texas and Louisiana, the Nebraska Department of Banking and Finance (“NDBF”) is cautioning investors to watch out for opportunistic investment scams.

“As we are seeing in Texas and Louisiana, natural disasters bring out the best in people, with neighbors helping neighbors. Unfortunately, we know from experience that disasters also can bring out the worst in people, particularly those seeking to profit from the misfortune of others,” NDBF Deputy Director Claire McHenry said. “Unsolicited investment offers seeking to capitalize on the aftermath of Hurricane Harvey should be approached with extreme caution.”

McHenry urged investors to watch for red flags of hurricane-related scams, including unsolicited email, social media messages, crowdfunding pitches or telephone calls promoting investment pools or bonds to help storm victims, water-removal or purification technologies, electricity-generating devices and distressed real estate remediation programs.

Scam artists also may linger to prey on storm victims who anticipate receiving large lump-sum insurance settlements. “The potential for fraud remains even after the skies have cleared. Be wary of any promoter promising quick and high returns on your investments,” McHenry warned.

NDBF also cautioned about fraudulent charitable solicitations that prey on the goodness of people seeking to help those in need. “The best advice is to do your research. Give to those charitable organizations that are registered properly with state authorities. As with any charitable contribution, those who want to contribute to relief efforts should send contributions to only those charities with an established track record of making sure the donations get to the victims,” McHenry said.

 

NDBF offered three tips to help investors avoid disaster-related scams:

  • Delete unsolicited emails or social media messages and hang up on aggressive cold callers promoting hurricane-related investments, especially those from small companies touting unproven or new technologies or products.
  • Use common sense. Claims of guaranteed returns or low/no investment risk are classic red flags. Every investment involves some degree of risk.
  • Do your homework. Contact NDBF to check that both the seller and investment are licensed and registered. If not, they may be operating illegally.

More information about the laws governing the securities industry in Nebraska can be found on NDBF’s website at www.ndbf.nebraska.gov. If you have questions about any investment matters, call NDBF’s Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state.

CONTACT: Claire McHenry, Deputy Director – Securities Bureau
PHONE: (402) 471-2171
EMAIL: claire.mchenry@nebraska.gov

Hurricane Harvey Consumer Alert

Financial Institution Officers

Publication Date: Aug 24, 2017

The Nebraska Department of Banking and Finance has adopted forms and guidelines to implement amendments to the laws governing the licensing of bank executive officers and credit union loan officers.  The amendments, adopted as part of LB 140 (2017), are effective August 24, 2017, and authorize exemptions from the licensing process.  The Department has also updated a number of related forms to reflect the amendments.

Click here for the Financial Institution Officer Exemptions

Investment Adviser Seminar

Publication Date: Jul 13, 2017

NDBF to Hold August 17th Investment Adviser Compliance Seminar

The Nebraska Department of Banking and Finance (“NDBF”) recently announced comprehensive amendments to its Rules under the Securities Act of Nebraska, contained in Title 48 of the Nebraska Administrative Code, became effective on June 5, 2017.  The amendments reflect NDBF’s goal of reducing regulatory complexity and promoting uniformity while protecting investors and promoting capital formation in Nebraska.

The NDBF Bureau of Securities will host a compliance seminar on August 17, 2017 at 2:00 pm CDT to assist investment advisers and their compliance personnel in understanding and complying with these new requirements.  Speakers will include NDBF Director Mark Quandahl, Deputy Director – Securities Bureau Claire McHenry, and Securities Bureau Counsel Mike Cameron. 

People may attend in person or electronically via webinar.  Space is limited.  Register by August 11, 2017 to reserve your seat.

Where:            Training Room – Basement Level
                        1526 K Street
                        Lincoln, NE 68508

When:             August 17, 2017
                        2:00 pm – 3:30 pm

Registration:  Click here to email the NDBF Securities Bureau.  Include in the email your name, firm, and whether you will attend in person or via webinar. Webinar participants will be emailed instructions on joining the webinar.

 

 NDBF Investment Adviser Compliance Seminar

Securities Rules Update Announced

Publication Date: Jun 20, 2017

Securities Act of Nebraska Rules Effective

Comprehensive Securities Rules Update Announced

JUNE 20, 2017 (LINCOLN, NEB.) — The Nebraska Department of Banking & Finance (“Department”)
announces that amendments to its Rules under the Securities Act of Nebraska contained in Title 48 of
the Nebraska Administrative Code became effective June 5, 2017. These amendments represent the
first comprehensive amendments to these rules since 1999, as 33 of the 42 chapters in Title 48 were
amended.

The amendments reflect the Department’s goal of reducing regulatory complexity and promoting
uniformity while protecting investors and promoting capital formation in Nebraska. Highlights of the
amendments include the following:

  • Implements filing requirements for Regulation A, Tier 2 Offerings,
  •  Increases the maximum amount that can be raised pursuant to the Intrastate Offering Exemption, Section 8-1111(20) of the Securities Act of Nebraska, from $750,000.00 to $1,000,000.00,
  •  Amends the information required to be submitted to the Department to request an Order Curing Late Notice for certain notice filings,
  •  Adopts the most recent North American Securities Administrators Association (“NASAA”) Statements of Policy concerning the registration of securities in Nebraska,
  •  Adopts the recent amendments to NASAA’s Brochure Rule for state -registered investment advisers,
  •  Adopts NASAA’s model custody rule for state -registered investment advisers, which includes a definition of the term “custody”,
  •  Adopts rules concerning succession planning for state-registered investment advisers, and
  •  Repeals a rule concerning debt securities issued by a church or congregation

Copies of the updated regulations are available on the Department’s website.

The Department will be conducting compliance seminars with state-registered investment advisers to
discuss rule amendments affecting them. Details regarding the seminars will be forthcoming in the next
few weeks.

 

View Notice of New Securities Rules

World Elder Abuse Awareness Day

Publication Date: Jun 15, 2017

NDBF Recognizes World Elder Abuse Awareness Day

Encourages Financial Firms to Watch for Signs of Elder Financial Fraud and Exploitation

June 15, 2017 (LINCOLN, NEB.) – In recognition of World Elder Abuse Day on June 15, 2017, the Nebraska Department of Banking and Finance (NDBF) reminds financial professionals of the importance of safeguarding Nebraska’s senior population by keeping a watchful eye for signs of elder financial exploitation and promptly reporting possible abuse to appropriate authorities.

Elder financial abuse is on the rise due to the amount of wealth seniors have accumulated throughout their careers and the increasing number of retirees throughout North America.

"Seniors are often targeted for financial fraud and exploitation because they may be isolated from family, caregivers, and other support networks. In other instances, it could be family or caregivers who are taking advantage of the vulnerable adult who feels he/she cannot say anything due to fear of retribution. That's why it is important to know the red flags that could signal an elder's savings may be in danger, " NDBF Director Mark Quandahl said.

Director Quandahl highlighted three warning signs of possible elder financial fraud or exploitation to watch for:

  • Has the elder moved away from existing relationships and toward new associations with other "friends" or strangers who show excessive interest in his or her finances or accounts, refuse to allow the elder to speak or are reluctant to leave the senior's side during conversations?
  • Does the elder show an unusual degree of fear, anxiety, submissiveness or deference toward the person accompanying him or her?
  • Does the elder display unexplained or unusual excitement over an investment opportunity, financial windfall or prize check?

"Financial services professionals are uniquely positioned to serve as a front line of defense to spot potential elder financial fraud and exploitation and alert authorities," Director Quandahl said.

Financial professionals who suspect elder financial fraud or exploitation are encouraged to contact NDBF through the department's website at www.ndbf.nebraska.gov, or by calling the NDBF Consumer Hotline toll free at (877) 471-3445 in Nebraska, or (402) 471-3445 if you are out of state. People who have reason to believe a vulnerable adult has been abused, neglected or exploited may contact the Nebraska Department of Health & Human Services, Adult Protect Services 24-hour hotline toll free at (800) 652-1999 or lo.cal law enforcement.

NDBF has teamed with the North American Securities Administrators Association, of which it is a member, to provide free training to help financial services employees learn how to identify and report suspected cases of senior financial exploitation. To learn more about the Senior$afe training program, or to request a training session for your firm, contact the Department.

 

World Elder Abuse Awareness Day

 

Girls State

Publication Date: Jun 8, 2017

On Thursday June 8, 2017, Department of Banking and Finance Legal Counsel Mike Cameron and Deputy Director Financial Institutions Kelly Lammers met with Girls State participants.  The discussion included the uniqueness of Nebraska Securities and Banking regulations, the volume of updates to laws and rules over this past year, and time for questions, which included interest in ID theft.  Pictured below in a State Capitol hearing room are Mike Cameron and Girls State delegates representing the communities of Friend, Hartington, Callaway, Scribner, Sutherland, Syracuse, Tekamah, Mullen, Wahoo, and Minden.

Consumer Alert

Publication Date: May 22, 2017

Nebraska Man Convicted of Securities Fraud

May 22, 2017 (Lincoln, Neb.) – Scott Robert Prill (“Prill”), formerly of Kearney and Holdrege Nebraska, has been convicted of securities fraud in three Nebraska counties. Prill sold unregistered promissory note securities to Nebraska residents to fund a cattle business. Prill also fraudulently failed to provide material information to the investors in his offer and sale of securities to them. Prill was sentenced to five years of probation in Douglas County, five years of probation in Phelps County, and six years of probation in Buffalo County. In addition, Prill was sentenced to 180 days in jail in Buffalo County. Prill was also ordered to pay restitution totaling $128,000.

Scott Robert Prill Consumer Alert May 2017

Consumer Alert

Publication Date: May 10, 2017

Papillion Company Ordered to Stop Soliciting Investors

The Nebraska Department of Banking and Finance (“Department”) has issued a Cease and Desist Order to Blazefly, Inc., Papillion, NE, its President Jamie Crager, and its affiliates, control persons, officers, directors, agents, and employees.  The Order prohibits the entity and individuals named from offering or selling securities in Nebraska until the securities have been registered, and until the entity and individuals are registered as broker-dealers or agents of a broker-dealer with the Department.   

Blazefly Inc C&D
Blazefly Inc Order Affirming C&D
Consumer Alert Blazefly Inc May 2017

Cease and Desist Order Issued

Publication Date: Apr 20, 2017

Cease and Desist Order Issued to Mortgage Servicers

The Nebraska Department of Banking and Finance has issued a Cease and Desist Order to Ocwen Financial Corporation through its Nebraska licensed subsidiaries, Ocwen Loan Servicing, LLC and Ocwen Mortgage Servicing, Inc.  The Order prohibits the companies from the acquisition of mortgage servicing rights and the origination of mortgage loans until they are able to prove they can appropriately manage their consumer mortgage escrow accounts.

 

NDBF Press Release – Ocwen Financial Corp. 4-20-2017

Ocwen Financial Corp. Cease and Desist Order

Consumer Fact Sheet

Banking Act Update Signed

Publication Date: Mar 30, 2017

Comprehensive Banking Act Update Signed Into Law

LB 140 was signed into law by Governor Pete Ricketts on March 29, 2017, during a ceremony at the Nebraska State Capitol.  LB 140 is the first comprehensive revision of the Nebraska Banking Act since 1963.  LB 140 also updates related laws for banks and other financial institutions. 

 

In 2016, then Banking, Commerce and Insurance (BCI) Committee Chair Jim Scheer introduced Legislative Resolution 430, proposing to study whether the Nebraska Banking Act should be updated. Senator Scheer gathered legislators, BCI committee staff, banking and credit union industry professionals and Department of Banking and Finance (NDBF) staff into a working group, and led a seven-month section by section review and redrafting of the Act.  LB 140 is the product of the LR 430 study committee and reflects its goals:  reducing regulatory complexity and carefully updating the Act to reflect the current banking environment, while protecting consumers and preserving the public confidence in the financial institutions of Nebraska.

 

LB 140 was introduced by Senator Matt Williams, Vice Chair of BCI, who participated in the working group.  The bill as introduced encompassed 143 Pages and 157 Sections, consisting of a combination of new sections, repealed sections, and amendments of existing sections of the Banking Act. Among its provisions, LB 140 authorizes an increase in the maximum number of a bank board of directors from 15 to 25; prohibits bank-affiliated individuals from being paid a higher rate of interest on deposits than paid by the bank for similar deposits and provides that a violation is a Class IV felony; allows financial institutions, in a state of emergency, to open a temporary office to conduct business for up to 30 months; authorizes the Department to provide for the electronic filing of certain bonds; repeals a registration requirement for banks making personal loans; and clarifies merger and acquisition procedures. 

 

The Legislature incorporated three other bills into LB 140:  LB196, introduced by Sen. Joni Craighead at the request of NDBF, which provides an annual update of the equal rights laws for  state-chartered depository financial institutions with their federal counterparts, and LB341 and LB 454, introduced by current BCI Chair Sen. Brett Lindstrom, who participated in the LR 430 working group. These bills allow for an opt-out of licensing requirements for bank executive officers and credit union loan officers, respectively.   

 

With the exception of the three sections amended by former LB 196, which carried the emergency clause and became effective March 30, 2017, LB 140 will become effective on or about September 1, 2017. NDBF will provide detailed information on the changes prior to that date.   The Slip Law version of LB 140 can be viewed at http://nebraskalegislature.gov/bills/view_bill.php?DocumentID=30705

 

Consumer Alert

Publication Date: Mar 20, 2017

Omaha Company Ordered to Stop Soliciting Investors

The Nebraska Department of Banking and Finance (“Department”) issued a Cease and Desist Order against an Omaha-based company, Parker Grant BMC, Inc., its President Daniel M. Porter (“Porter”), and its affiliates, control persons, officers, directors, agents, and employees. The Order prohibits the entity and individuals named from offering or selling securities in Nebraska until they are registered as broker-dealers or agents of a broker-dealer with the Department.

Parker Grant BMC Consumer Alert
Parker Grant BMC C&D

BSA/AML Self-Assessment Tool

Publication Date: Feb 2, 2017

State Regulators Release BSA/AML Self-Assessment Tool

 

State regulators and the Conference of State Bank Supervisors (CSBS) have released a new voluntary self-assessment tool to help banks better manage Bank Secrecy Act and anti-money laundering risk. The tool is meant to help institutions better identify, monitor, and communicate BSA/AML risk, reduce uncertainty surrounding BSA/AML compliance and foster greater transparency within the industry. Learn more and access the tool at the CSBD WebSite.

New Look & New Web Address

Publication Date: Feb 1, 2017

The Nebraska Department of Banking and Finance web page will have a new look and a new web address ndbf.nebraska.gov on 2/1/2017.  The old web address www.ndbf.ne.gov will automatically redirect to ndbf.nebraska.gov; however, bookmarks and links will need to be updated.  If you have questions, please contact your Review Examiner at 402-471-2171 or write DOB.info@nebraska.gov .