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BP Payout Recipients: Be on the Lookout for Investment Scams

Investor Alert - BP Payout Recipients: Be on the Lookout for Investment Scams

The SEC’s Office of Investor Education and Advocacy is issuing this Investor Alert to help educate investors, including individuals and small businesses receiving lump sum payouts from BP related to the oil spill in the Gulf, about potential investment frauds that target recipients of lump sum payouts.

Recipients of highly-publicized payouts often become targets for investment fraud. Scam artists may target payout recipients with oil spill-related investment opportunities that promise high returns with little or no risk, or involve secretive or complex strategies. Members of religious or ethnic communities, professional organizations or other close-knit affinity groups could be likely targets for these scams because of the high level of trust that often exists within these groups and their tendency to share information with one another. After Hurricane Katrina we heard about scams targeting individuals receiving compensation from insurance companies. These scams took a number of forms, including trading programs falsely guaranteeing high returns, promoters touting companies purportedly involved in clean-up efforts, as well as classic Ponzi schemes. We are concerned that individuals receiving lump sum payouts, including payments from BP, may become targets for investment scams and other frauds. As is true for recipients of any lump sum payout, individuals and small businesses receiving payments from BP should be wary of potential investment scams.

One of the best ways to avoid investment fraud is to ask questions. Always ask if the seller is licensed and if the investment is registered, then check out the answers with an unbiased source, such as the SEC. We have a short publication called Ask Questions that discusses many of the other questions you should ask of anyone who wants you to make an investment. Please take a look at it before making any investment decisions.

Taking a close look at your entire financial situation can help you use a lump sum payout wisely. Below is a list of some of our online resources that may be helpful in deciding how to use a lump sum payout. Please take the time to protect yourself by reviewing them before you invest -- this payment may have to last you and your family for a long time. Finally, if you are thinking about investing and have any questions, do not hesitate to call the SEC's Office of Investor Education and Advocacy at 1-800-SEC-0330, or to ask a question using this online form.

Other Resources

  • Public Library Outreach: The SEC is working with public libraries to make it easier for BP payout recipients and other Gulf residents to learn how to save and invest wisely. The SEC’s Invest Wisely Folders for Gulf Residents contain hard copies of the materials listed in this investor alert and other helpful materials for library patrons. To order these folders for your library, contact Frank Locker, Librarian, Office of Investor Education and Advocacy, at (202) 551-6318, or email LibraryOutreach@sec.gov.


  • Reporting Other Oil Spill-related Scams: Please contact the National Center for Disaster Fraud (NCDF). Call: 1-866-720-5721; email: disaster@leo.gov; or fax: 225-334-4707.


  • Taxes and Related Issues: For information on taxes and other related issues, see the IRS’s Gulf Oil Spill Information Center and the IRS’s Question and Answers on the Gulf Oil Spill.


  • Other Oil Spill-related Scams: For information on other types of oil spill related scams, see the FTC’s Consumer Alert FTC Warns of Oil Spill Scams.


  • Additional Financial Education Resources: For additional financial education resources, visit MyMoney.gov, the U.S. government's website dedicated to teaching all Americans the basics about financial education.


The Office of Investor Education and Advocacy has provided this information as a service to investors.  It is neither a legal interpretation nor a statement of SEC policy.  If you have questions concerning the meaning or application of a particular law or rule, please consult with an attorney who specializes in securities law.