Have You Been Accused Of Securities Fraud?
by Arnab Dey Legal Published on: 27 April 2023 Last Updated on: 11 December 2023
Being accused of something is always a scary situation to be in. With the law involved, it will affect you financially, mentally, and professionally.
Your public image is tarnished, and it may look like you are headed to prison for a long time. If you have been accused of securities fraud, there are certain steps you can take to avoid any further damages or jail time.
What is securities fraud?
Securities fraud is a white-collar crime and an umbrella term for many crimes committed by breaking the laws set to protect financial traders and investors. It occurs when an entity or individual deliberately cheats, lies, and steals investments for personal monetary gain.
Stockbrokers, analysts, investment bankers, brokerage firms, corporations, and private investors are often the perpetrators of securities fraud.
Examples of securities fraud
Securities fraud, often known as stock or investment fraud, is a major white-collar crime that can take many different approaches but is usually accomplished by falsifying information that investors rely on to make financial judgments.
An umbrella term for many white-collar crimes, including manipulating or breaking the laws meant to protect shareholders, securities traders, and investors.
Here are examples of securities fraud for a better understanding.
- Insider Trading: Securities trading using information about a company that is not accessible to the general public to gain financial benefits.
- Ponzi Schemes: This fraudulent investment scheme entices investors with high rates of return and little risk. A Ponzi scheme is a fraudulent investment operation in which money is collected from subsequent participants to pay returns to earlier investors.
- Fake Companies: Setting up a phony company to seek funding or selling equity stakes to investors.
- Accounting Fraud: Keeping inaccurate books and presenting falsified information for personal financial gains or stealing funds.
Who will be investigating it?
Since it is a federal crime, the FBI will be involved, which makes these kinds of fraud cases highly sensitive. The bureau will conduct a thorough check before clearing the case. The Securities and Exchange Commission will prosecute perpetrators based on an investigation conducted by the bureau.
You will not know you are being investigated until the FBI has garnered enough proof to build a case against you. Once done, you will be immediately arrested and accused of securities fraud.
If you have been arrested and accused of securities fraud, you need to be prepared to navigate the situation. Take each step cautiously to avoid increasing suspicion.
Related: What To Expect During A Small Business Fraud Case
Lawyer up immediately!
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Do I have a case? Securities Fraud Claims can be both pursued and defended against by a lawyer, so you almost certainly have a right to hire one. Contact a lawyer as soon as possible, and remain silent until your lawyer asks you to say something. Hire an attorney immediately after you realize you are being investigated or accused of securities fraud.
So contact a lawyer, and remain silent until your lawyer asks you to say something. Hire an attorney immediately after you realize you are being investigated or accused of securities fraud.
Put a stop to transactions
Immediately terminate any current and future transactions you planned for or are about to do. The authorities will closely monitor you and question your every step. So it is better to avoid making any transaction that raises questions or suspicion until proven innocent.
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