The Associated Press

WASHINGTON - State securities regulators have identified 10 top investment frauds, with improper mutual fund practices, scams targeting seniors and variable annuities new to the annual list.

The schemes are increasingly complex and confusing, costing Americans billions of dollars a year, the North American Securities Administrators Association said Wednesday. The group represents securities regulators in the 50 states, the District of Columbia, Puerto Rico, Canada and Mexico.

The schemes are ranked roughly in order of prevalence or concern.

• Ponzi schemes: Perennial favorites, whose perpetrators use the money from recent investors to pay returns to earlier investors, until the schemes collapse. Promoters typically blame government intervention for the failure of new investors to get their promised returns.

• Investment fraud targeting seniors: These complex investment scams promise huge returns.

• Promissory notes: They typically involve loans to companies made by investors in exchange for a fixed amount of periodic income. However, legitimate corporate promissory notes are not usually sold to the general public and some schemes are fraudulent. The schemes often falsely claim the money invested is guaranteed by insurance companies or collateral located offshore, and promise unusually high returns.

• Unscrupulous brokers: Regulators say they receive many investor complaints about brokers cutting corners or engaging in fraud to enrich themselves.

• Affinity group fraud: Investment scams targeting religious, ethnic and professional groups, perpetrated by members of the groups or people claiming to want to help them.

• Insurance agents and other unlicensed individuals selling securities: To verify that someone is licensed to sell securities, regulators advise consumers to call their state securities regulator.

• Prime bank schemes: They promise investors risk-free, triple-digit returns on debt notes said to be guaranteed by the world's biggest banks. Promoters often claim that only big corporations, foreign banks and very wealthy individuals know about prime bank notes.

• Internet fraud: Scams include stock price manipulation, illegal pyramid schemes, insider trading and acting as a broker or investment adviser without being licensed. Regulators urge investors to ignore anonymous financial advice on the Internet.

• Mutual fund practices: The industry scandal has ensnared dozens of mutual fund companies and brokerage firms. Illegal practices include after-hours trading. By going through brokerage firms and other third parties, some big investors such as hedge funds have been able to cash in on after-hours news ahead of most shareholders.

• Variable annuities: Regulators say they're concerned that investors aren't being told about high surrender charges or are being misled with claims of guaranteed returns. Variable annuities are not suitable for many retirees who cannot afford to lock up their money for a long time, regulators say.