LAS VEGAS (KLAS) — Victims of investment schemes would be eligible for $25,000 from a fund managed by the Nevada Secretary of State’s Office under a proposal presented in Carson City on Thursday.
Officials admitted that it’s not much for some people who have lost their entire life’s savings to people promising high returns on investments. But it’s a start, they said.
Senate Bill 76 (SB76) would set up a fund for Nevada victims of securities fraud, limited to a maximum of $25,000 and only if the perpetrator of the scheme was ordered to pay restitution. It’s common in these cases for all the money to disappear when scammers realize they are going to be prosecuted.
Erin Houston, deputy secretary of state for securities, described a typical scenario to lawmakers: A person with a low net worth or a low salary is lured to invest in a local startup company on the promise of high returns. The investment fails and the victim has no recourse. Often, the victim is a senior on a fixed income and they lose all the money they invested.
Secretary of State Francisco “Cisco” Aguilar presented SB76 to the Senate Judiciary Committee, telling senators the fund could be created from money that is being brought in already from enforcement actions. That money currently goes directly to the state’s general fund, but Aguilar wants to hold back $500,000 each year to provide just a small amount of relief to victims of these crimes.
It’s been done in six states already, with such a fund in place in Indiana, Maine, Montana, North Dakota, Ohio and Vermont, according to the Secretary of State’s Office.
Representatives from the American Association of Retired Persons (AARP) said such scams are a monumental problem, amounting to $36 billion annually in the U.S. AARP said Nevada is No. 3 in the nation for such scams, citing an FTC report that Nevada consumers reported $113.6 million in fraud losses in 2023.
AARP and others who testified in favor of SB76 lamented that these fraud cases aren’t being treated more seriously.
The $500,000 fund would help address the gap between actual restitution made in criminal prosecutions — $205,000 in the most recent fiscal year — and the restitution awarded in those cases — $760,000.
Two more bills introduced this week:
SEX TRAFFICKING: SB223 would increase penalties in cases involving sex trafficking a child, adding five years to the time an inmate would be eligible for parole. Cases involving victims under 14 years old would be eligible for parole after 20 years (currently 15). When the victim is 14 to 16 years old, parole eligibility would come after 15 years rather than the current 10 years under state law. And when the victim is 16 to 18 years old, parole could come after 10 years (currently five under state law). The bill would also increase the penalties for “facilitating sex trafficking of a minor. Current sentencing guidelines of three to 10 years would increase to a higher level, eight to 20 years. The bill is sponsored by Republican Sen. Carrie Buck, who represents parts of Henderson and the southeast valley.
SCHOOL PSYCHOLOGISTS: SB227 would enact the School Psychologist Interstate Licensure Compact, allowing psychologists licensed in another state to work in Nevada. It’s a strategy similar to agreements allowing nurses to work in multiple states without the need to acquire a license in each state. The strategy overcomes barriers when there is a high need and a relatively low number of people available with the right training. Nevada currently needs school psychologists.
