Securities Fraud Law
To consult State Legislation regarding security fraud laws and regulations please see the Criminal Code by State page.
Securities Fraud Law - US
- CFTC - Division of Enforcement - Consumer Protection
The CFTC's Division of Enforcement investigates and prosecutes alleged violations of the Commodity Exchange Act and Commission regulations. The Commission relies on the public as an important source of information in carrying out its regulatory and enforcement responsibilities. You may contact us to report suspicious activities or transactions which may involve the trading of commodity futures contracts or commodity options.
- Federal Securities Law
The Federal Securities Laws are comprised of a series of statutes, which in turn authorize a series of regulations promulgated by the government agency with general oversight responsibility for the securities industry, the Securities and Exchange Commission. The two main statutes involved in the Federal Securities laws are the The Securities Act of 1933 and the The Securities Exchange Act of 1934. Generally speaking, the '33 Act governs the issuance of securities by companies, and the '34 Act governs the trading, purchase and sale of those securities. Each has a wealth of regulations promulgated by the Securities and Exchange Commission, as well as regulations adopted by the National Association of Securities Dealers, Inc. and the various stock exchanges.
- Financial Fraud Enforcement Task Force
President Obama established the Financial Fraud Enforcement Task Force in November 2009 to hold accountable those who helped bring about the last financial crisis, and to prevent another crisis from happening. The task force is improving efforts across the government and with state and local partners to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, recover proceeds for victims and address financial discrimination in the lending and financial markets.
- Insider Trading - Information
Insider trading” refers to transactions in a company’s securities, such as stocks or options, by corporate insiders or their associates based on information originating within the firm that would, once publicly disclosed, affect the prices of such securities. Corporate insiders are individuals whose employment with the firm (as executives, directors, or sometimes rank-and-file employees) or whose privileged access to the firm’s internal affairs (as large shareholders, consultants, accountants, lawyers, etc.) gives them valuable information.
- Private Securities Litigation Reform Act of 1995
The United States Private Securities Litigation Reform Act of 1995, Pub. L. 104-67, 109 Stat. 737 (codified as amended in scattered sections of 15 U.S.C.) ("PSLRA") implemented several substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation, and awards fees and expenses. It was designed to reduce the number of “frivolous” securities lawsuits filed in federal courts. In essence, it says that investors cannot proceed with a case unless they already have facts in-hand that strongly suggest a deliberate fraud.
- Sarbanes-Oxley Act
The Sarbanes–Oxley Act of 2002 was enacted as a reaction to a number of major corporate and accounting scandals including those affecting Enron, Tyco International, Adelphia, Peregrine Systems and WorldCom. These scandals, which cost investors billions of dollars when the share prices of affected companies collapsed, shook public confidence in the nation's securities markets.
- Securities Act of 1933
Congress enacted the Securities Act of 1933 (the 1933 Act, the Securities Act, the Truth in Securities Act, the Federal Securities Act, or the '33 Act, 48 Stat. 74, enacted 1933-05-27, codified at 15 U.S.C. § 77a et seq.), in the aftermath of the stock market crash of 1929 and during the ensuing Great Depression. Legislated pursuant to the interstate commerce clause of the Constitution, it requires that any offer or sale of securities using the means and instrumentalities of interstate commerce be registered pursuant to the 1933 Act, unless an exemption from registration exists under the law.
- Securities Exchange Act of 1934 (Exchange Act) - Section 10b and Rule 10b-5
The Exchange Act protects investors by making sure information is available, but also protects investors by prohibiting fraud and establishing severe penalties for those who defraud investors, as well as those who engage in some trading practices that take advantage of information most investors do not have. When federal securities laws are violated by market participants, the SEC can bring a civil enforcement action and can also bring criminal actions for some violations. The Exchange Act is also more generous than the Securities Act in providing investors with a right to bring a private suit against market participants who have defrauded them: * Section 10b and Rule 10b-5: These are the principal statutory weapons against fraud.
- Securities Fraud - Definition
Securities fraud, also known as stock fraud and investment fraud, is a practice that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in losses, in violation of the securities laws. Generally speaking, securities fraud consists of deceptive practices in the stock and commodity markets, and occurs when investors are enticed to part with their money based on untrue statements.
Organizations Related to Securities Fraud Law
- Commodities Futures Trading Commission
The CFTC's mission is to protect market users and the public from fraud, manipulation, and abusive practices related to the sale of commodity and financial futures and options, and to foster open, competitive, and financially sound futures and option markets.
- Financial Industry Regulatory Authority (FINRA)
About the Financial Industry Regulatory Authority The Financial Industry Regulatory Authority (FINRA) is the largest independent regulator for all securities firms doing business in the United States. All told, FINRA oversees nearly 4,700 brokerage firms, about 167,000 branch offices and approximately 635,000 registered securities representatives.
- National Association of Securities Dealers Automated Quotations (NASDAQ)
NASDAQ is an acronym standing for National Association of Securities Dealers Automated Quotations. But this automated quotation system quickly matured far beyond its original quote-service roots, evolving into what it is today—a major world stock market. Indeed, what NASDAQ "stands for" is not nearly as relevant as what The NASDAQ Stock Market has become known for, namely pioneering screen-based technology and an abundance of growth companies.
- National Association of Stockbrokers
In the last 22 years we have developed an exclusive list of top stockbrokers, analysts and institutional money managers. We now have approximately 20,000 members nationwide, 400 in each of the 45 chapters. Our members are most concerned about recent developments and future outlook. This face to face contact is very beneficial since they recommend stocks they know about personally. Most of our companies come back every year to keep in contact with our chapters.
- National Futures Association - Background Affiliation Status Information Center (BASIC)
Whether you are an investor thinking about opening a futures account or an NFA Member contemplating a new business relationship, BASIC can be a valuable resource for you. BASIC contains Commodity Futures Trading Commission (CFTC) registration and NFA membership information and futures-related regulatory and non-regulatory actions contributed by NFA, the CFTC and the U.S. futures exchanges.
- North American Securities Administrators Association (NASAA)
Organized in 1919, the North American Securities Administrators Association (NASAA) is the oldest international organization devoted to investor protection. NASAA is a voluntary association whose membership consists of 67 state, provincial, and territorial securities administrators in the 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Canada, and Mexico.
- NYSE Regulation, Inc
NYSE Regulation Overview Leadership Board of Directors Committees Governance Investor Protection Office of the Hearing Board NYSE Regulation, Inc., is a not-for-profit corporation dedicated to strengthening market integrity and investor protection. In addition to its regulatory responsibilities to enforce marketplace rules and federal securities laws of the New York Stock Exchange, NYSE Regulation oversees NYSE Arca Regulation and NYSE Amex Regulation through regulatory services agreements.
- SEC Center for Complaints and Enforcement Tips
You can file a complaint or provide us with tips on potential securities law violations though the links on this page. We welcome hearing from you because your information may alert us to broker or firm misconduct, an unfair practice in the securities industry that needs to be changed, or the latest fraud.
- Securities and Exchange Commission (SEC)
The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation. As more and more first-time investors turn to the markets to help secure their futures, pay for homes, and send children to college, our investor protection mission is more compelling than ever.
- Securities Fraud and Investor Protection Resource Center
Do you think you may have been a victim of securities fraud? What are your rights as an investor and what duties does your broker owe to you? How do you know if you have been defrauded by your stockbroker or investment advisor? What can you do about it, if you have been subjected to stockbroker fraud? You will find information at this web site which will assist you in addressing these questions and others which may arise in connection with improper investments and stockbroker/customer disputes.
Publications Related to Securities Fraud Law
- SEC News Digest
The SEC News Digest provides daily information on recent Commission actions, including enforcement proceedings, rule filings, policy statements, and upcoming Commission meetings.
- Securities Fraud - Articles and Publications
Many contend that securities fraud has been a result of deregulation of the securities industry since at least the early 1980s, with an attendant relaxation of supervision by the U.S. Securities and Exchange Commission (SEC). The 1990s saw a renewed and accelerated effort by the SEC and other regulatory agencies to regulate the securities industry.
- Securities Fraud - Business Services Industry
US FEDERAL SECURITIES regulators recently launched an Internet fraud sweep targeting suspects who allegedly were involved in stock manipulation schemes. The Securities and Exchange Commission (SEC) took action against 33 individuals and small entities accused of funneling more than $10 million in illegal profits by means of cyber-fraud.
Articles on HG.org Related to Securities Fraud Law
- An IRS Criminal Investigation at a GlanceThe Internal Revenue Service Criminal Investigation Division serves the American public by conducting criminal investigations regarding alleged tax violation and various money laundering statutes. The IRS is the only federal agency that can investigate potential criminal violations of the Internal Revenue Code. There is a long, complicated investigation process involving many levels of personnel that goes into prosecuting these types of criminals.
- Combatting Counterparty Risk with Central Counter-Parties - MaltaChasing payment of dues is a mundane yet critical element of every business process. Hugely time consuming, it could expose any activity large or small to counter-party risk, even more so in times of economic crisis.
- Schwab Auction Rate Securities' Investors, Are Your ARS Accounts Now Frozen?Many investors have been "left out in the cold," so to speak, after they were left holding an unsalable product they were told was safe, secure, and "as good as cash." Investors were told that Schwab's Auction Rate Securities (ARS) were both liquid and safe when they were anything but. The economy's collapse in 2008 left investors out in the cold;t these illiquid assets could no longer be touched and they were in assets worthless.
- Hong Kong Stock Exchange Guidance on Pre-IPO InvestmentsIn October 2012, the Hong Kong Stock Exchange (“HKEx”) published two guidance letters on Pre-IPO investments and Pre-IPO investment in convertible instrument respectively. The purpose of the two guidance letters is to consolidate previous HKEx’s listing decisions on Pre-IPO investments and to set out its current practice when dealing with convertible instruments issued to Pre-IPO investors.
- New York State Tops the Nation With Investment Fraud SchemesNew York City is known as the nation capital for federal securities and investment fraud investigations and prosecutions. The most common claims in arbitration filed in New York include Breach of Fiduciary Duty, Negligence, Fraud/Misrepresentation, Failure to Supervise and Breach of Contract.
- 10 Bad Faith Insurance Claim PracticesLearn about some common bad faith insurance claim practices. If you are dealing with a denied claim after unfair practice, get legal help from a Denver attorney.
- Life Insurance Claims in North CarolinaThis Article addresses life insurance claims in North Carolina, and some issues that frequently arise in these claims, including whether the death is accidental, and whether the insured made a misrepresentation in the policy application. Life insurance claims in North Carolina are governed by the policy itself, state statutes, and sometimes federal ERISA laws.
- Membership Criteria's to Istanbul Stock Exchange ChangedA new regulation has been promulgated in the Official Gazette dated December 8, 2012, numbered 28491, which determine the criteria for permission to operate at Istanbul Stock Exchange (“Stock Exchange”), and the liabilities of the members. The regulation is highly functional as it is in line with the principles of corporate governance in the new Turkish Commercial Law.
- Dishonestly Cause a Loss in VictoriaHave you caused a financial or property loss in Victoria? You could be charged with “Dishonestly Cause a Loss”. Find out the elements of this Commonwealth offense and what you should do in case you get charged.
- What are White Collar Crimes?A question we get asked on our website all the time is, what are white collar crimes? With the rise in today's technology it's highly likely that you or someone you know has been a victim of a white collar crime from counterfeit currency to identity theft. Continue reading this article to understand more about the most popular forms of white collar crimes.