In an effort to combat fraud, the NH Bureau of Securities Regulation is alerting investors about the risk associated with promissory notes.
State securities regulators have identified promissory notes as a leading source of complaints to their agencies.
According to a statement, the North American Securities Administrators Association reported 210 investigations involving promissory notes, which led to 149 formal enforcement actions by state securities regulators last year.
The advisory reminds investors to be cautious of short-term promissory notes, in particular, those with durations of nine months or less, which generally do not require federal or state securities registration. Such short-term notes have been the source of most of the fraudulent activity involving promissory notes.
The state recommends before making any financial decisions, ask questions, do your homework and contact the NH Bureau of Securities Regulation at (603) 271-1463.