Investor education has never been a top priority for state spending in California, and that's truer than ever in these budget-strapped times.
Lacking specific funding for educational outreach, the Department of Corporations, the state securities regulator, runs occasional seminars and workshops at which enforcement officials offer tips on avoiding investment scams, according to spokeswoman Kam Coveyou.
The agency also provides information by mail and over its Web site, at www.corp.ca.gov, describing common stock swindles and predatory-lending schemes and explaining the basics of saving, borrowing and budgeting.
The educational efforts were beefed up by the creation last year of Seniors Against Investment Fraud, based at the Corporations Department and financed by a three-year, $1.2-million grant from the Governor's Office of Criminal Justice Planning.
Working through senior-advocacy and consumer groups, the statewide program trains volunteers to spread the anti-fraud message to the elderly at churches, senior centers and other gathering places.
Such efforts could get a significant boost from last month's $1.4-billion Wall Street settlement, which provides $85 million for investor education around the country. It is unclear how the money will be divided, but California could get about $5 million under a population-based split that is one of the options being considered.
California Corporations Commissioner Demetrios A. Boutris doesn't have a specific plan for the money, but given the shoestring nature of the agency's current educational efforts, "We'll know how to use it," Coveyou said.
Outside the Corporations Department, some basic financial-literacy education is offered by the Cooperative State Research, Education and Extension Service, a venerable program run jointly by the U.S. Department of Agriculture, 105 land-grant universities and 3,150 county governments across the country.
Securities and Exchange Commission officials see the service as a potential vehicle for grass-roots investor-education instruction under the settlement.
In California, however, the extension service reaches mostly low-income people who have little money to invest, noted Karen Varcoe, who runs the cooperative's financial-education program out of UC Riverside.
Most of the instructors are nutritionists who get extra training in basic household-finance issues such as budgeting and making sound spending and borrowing decisions.