BBB of Greater Houston & South Texas

News Release: For Immediate Release

The Better Business Bureau Serving:
Brazoria, Ft. Bend, Galveston, Harris, Matagorda, Montgomery, & Wharton Counties. (Texas)

Better Business Bureau Tips:
Editorial Ideas From Your Better Business Bureau

Contacts:
Deana Turner:
Office: 713-341-6131, e-mail: dturner@bbbhou.org

www.bbbhou.org * bbbinfo@bbbhou.org * Council of BBBs: www.bbb.org *
24-Hour Information: 713-868-9500, 877-468-9222 (from area code 409 only)

Taxpayers with IRAs Beware: IRS Does Not Approve IRA Investments

Many people pledge each New Year to set aside more funds to provide for a secure retirement. If you're among them, the Better Business Bureau (BBB) cautions you to be on the lookout for ads and solicitations that claim certain types of investments for Individual Retirement Accounts (IRA) are "IRS-approved" or "IRA-approved."

According to the Federal Trade Commission, investors are receiving misleading sales pitches for specific IRA investments via the telephone, the mail and the Internet. These solicitations claim that certain investments have been "approved" for IRAs. The fraudulent promoter tries to convince the consumer that the investment is safe, can be used for IRAs, and, that the investment has been reviewed and approved by the Internal Revenue Service (IRS). That is not the case.

Many consumers are confused by the role of the IRS when it comes to IRAs. The IRS issues letters to IRA sponsors, trustees and custodians certifying that they are in compliance with requirements concerning investor rights, account administration, and standards that allow contributions to be deductible. But the IRS does NOT:

review or approve investments;
advise people on how to invest their IRAs;
endorse any investments; or
issue statements that an investment in an IRA is "protected" because the IRS has
approved a particular trustee or custodian.

While many investment offers are legitimate, the BBB advises consumers to carefully examine each one before committing to anything. Check with the State Securities Board to make sure the investment and the person selling it are registered.

If you have a question or complaint about IRA investment opportunities contact your BBB (713.868.9500), the FTC (202.FTC.HELP), the Securities and Exchange Commission (1.800.SEC.0330), the State Securities Board (512.305.8300) or the North American Securities Administrators Association (202.737.0900).

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