LANSING – Today, the Office of Financial and Insurance Regulation (OFIR) announced the 12th Annual National Consumer Protection Week, March 7-13. This year’s theme is “Dollars and Sense: Rated ‘A’ for All Ages” and highlights consumer education for every stage of life – from grade school to retirement.

“The message of National Consumer Protection Week 2010 is simple - It’s never too early or too late to become a more informed and empowered consumer,” OFIR Commissioner Ken Ross said. “Regardless of your age or financial situation, there are useful lessons to learn about spending and managing money wisely.”
OFIR encourages consumers to visit its website, www.michigan.gov/ofir and the National Consumer Protection Week’s website http://consumer.gov/ncpw, for information about making smarter decisions in the marketplace.

OFIR has recently announced a number of consumer protection-related programs and actions, which include:

Investor Education in Your Community Program:
OFIR’s Investor Education in Your Community program educates investors on how to improve their personal finances and how to avoid falling victim to investment fraud. Over 1,000 Michigan investors have attended these seminars at over 50 different libraries across the state. For more information on the program, visit: http://www.wwj.com/pages/637880.php

Consumer Recoveries:
OFIR recovered a record $33,025,231 on behalf of Michigan consumers in 2009. The $33 million in consumer recoveries breaks the previous record of $17 million set by the agency in 2008. $9,286,100 of the consumer recoveries involved insurance and securities products and the remaining $23,739,131 involved mortgage and banking products. The 2009 recoveries were based on 6,548 complaints filed with OFIR during the year. OFIR Consumer assistance staff also answered nearly 125,000 consumer calls last year. The rise in consumer recoveries can largely be attributed to an increase in the amount of mortgage modifications OFIR assisted in.

“Free Lunch Seminar Monitor” Program:
OFIR started a “Free Lunch Seminar Monitor” program that gives individuals an opportunity to fight back against unscrupulous promoters by reporting questionable investment practices to OFIR for investigation. The program enlists the help of Michigan seniors, who attend seminars and report back to OFIR whether investors are being pressured into purchasing inappropriate or unsuitable investments. Participants can bring a checklist with them to help assure that both the products promoted at free investment seminars, as well as the promoters, conform to securities laws and regulations.

Investment Scams Training for Law Enforcement:
OFIR developed and provided a free training for Michigan law enforcement officials, “Securities 101: Recognizing Securities Products and Investment Crimes,” which helped them identify the most common types of securities fraud, how these schemes are structured and marketed, how to spot a questionable investment deal, and how OFIR’s Securities Division can assist them in their efforts. OFIR is also planning a securities a similar raining for Michigan prosecutors.

Mortgage Loan Officer Registration:
OFIR began registering the state’s mortgage loan officers. The registration strengthens the state's oversight of the loan industry's practices by mandating background checks and educational training for loan officers. Over 3,000 loan officers have registered to date.

Uniform Securities Act (USA):
OFIR worked closely with the state legislature on USA, which went into effect October 1, 2009. USA provides enhanced civil and criminal actions against perpetrators of securities fraud. The legislation also creates the Michigan Investor Education Fund, which will be funded entirely by securities fines and used solely for educating Michigan consumers on investment issues and how to avoid financial scams.

Auction Rate Securities (ARS) Settlements:
From September, 2008, to date, OFIR reached settlements with a number of brokerage firms regarding Auction Rate Securities (ARS) that require the firms to offer full buybacks to any eligible customer who purchased an ARS and make settlement payments to the state. OFIR has reached ARS settlements with Banc of America, Citigroup, Comerica, Deutsche Bank, JPMorgan, Merrill Lynch, Morgan Stanley, RBC and Wachovia. In total, OFIR settlements have resulted in offers for full buybacks of more than $3 billion to Michigan consumers and settlement payments of more than $7.2 million to the State of Michigan.

Fake Financial Institutions:
OFIR successfully shut down a number of fake financial entities that were posing as legitimate businesses in an attempt to steal consumers' money and identity. Through their websites, the fraudulent financial institutions were encouraging customers to apply for loans by providing up front payments and personal information. OFIR ordered the fake companies to cease and desist form doing business and contacted their websites’ hosts. The websites were then shut down.

Financial Scams:

Michael Winans Jr./Mark Carpenter
OFIR took action against a multi-million dollar Detroit-area Ponzi scheme run by Michael Winans Jr. that used the family name and connections in the Detroit religious community to prey on church members though a fraudulent crude oil bond investment program. OFIR found that Winans Jr., his direct subordinates and a number of related business entities violated the state’s Uniform Securities Act and the agency ordered them to cease and desist from the sale of unregistered securities products. OFIR determined the individuals were not licensed to sell securities products in Michigan and the products sold were not registered with the state. In related action, OFIR put an end to a multi-million dollar Ponzi scheme run by Ann Arbor’s Mark Carpenter through his company TGBG Financial. It is estimated that investors lost as much $15 million in these investment schemes. OFIR has handed the results of its investigations over to the appropriate law enforcement agencies.

John Bravata
Through consumer complaints, OFIR determined that John Bravata of Brighton and his company, BBC Equities, were selling unregistered securities products throughout Metro Detroit. In March, 2009, OFIR ordered Bravata to cease and desist and notified the SEC that it had suspicions Bravata was operating a Ponzi scheme. In July, 2009, the SEC halted the scheme and alleged that Bravata raised more than $50 million from at least 440 investors by offering them membership interests in a purported real estate investment fraud. The SEC’s case is currently pending.

Rita Gosselin
OFIR staff received information from Southgate police that Rita Gosselin of Grosse Ile was selling unregistered real estate investments in exchange for fraudulent promissory notes. In May, 2009 OFIR issued a cease and desist order against Gosselin. In December, 2009 the Attorney General announced the arrest of Gosselin and charged her with racketeering and multiple counts of obtaining money under false pretenses for orchestrating numerous fraudulent real estate investments and stealing hundreds of thousands of dollars from Michigan families.