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Securities Fraud Questions

Securities fraud includes outright theft from investors and misappropriated statements on a public company's financial reports. Securities fraud can also include a wide range of other actions, including insider trading, front running and other illegal acts on the trading floor of a stock or commodity exchange. Below are the most commonly asked questions about securities fraud.

What is securities fraud?

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.

Is there a securities fraud law in the state of New York

New York does not appear to have a specific state "securities fraud" provision, but any number of the fraud provisions might apply, depending on how the securities fraud was accomplished. The most likely are those contained in articles 170, 175 and 190. However, there are a number of federal laws that apply specifically to securities fraud -- they address forms of fraud including insider trading, false securities filings, and stock manipulation, embezzlement, and ponzi schemes, among others.

Can someone with a federal conviction of securities fraud get the restitution fine removed and have the charge expunged from their record?

In most cases the restitution can't be removed. It never goes away. Under federal law, it also is not dischargeable in bankruptcy. The government also isn't known to entertain the idea of a settlement of the debt, even where the payment would be substantial. Having a federal conviction expunged is extremely rare, because they can only be granted through an executive pardon from the President of the United States. The application forms can be found on the United States Department of Justice website.

Is there a statue of limitations for securities fraud in Georgia?

The statute of limitations here for fraud is two years in Georgia. The law does not specify any one type of fraud. However it does list 6 years for written contracts and 4 years for oral contracts. Many times depending on the fraud security fraud may fall in either of these categories. Securities fraud statute of limitations may vary according to State; the Experts on JustAnswer can give specific insight regarding state and federal laws.

If someone invested a large sum of money in an LLC company, under a written and verbal contract promising to get the investment back by a specific time frame, is this considered a type of securities fraud?

If you invested money in an LLC on the condition that your money would be returned by a specific time and they have not performed, then you can file a securities fraud suit against them. A member investing in an LLC is purchasing a securities interest which are subject to securities laws. If they have not followed through on promises they made to induce you to invest in the LLC, then they are liable. You would file this in civil district court. In many situations you may not be entitled to damages related to mental and physical illness, but you could seek punitive damages for their bad faith and fraud which would result in the same thing. Because of the nature of a securities fraud claim, you can file this suit against both the business and the principals. So, even if the business shuts down, you can still pursue them individually.

Securities fraud is a serious crime, which not only affects the victim but also can affect the consumer market. If you have any questions regarding securities fraud law, securities fraud penalties or even how to report securities fraud, asking an Expert could provide you with an answer quickly and affordably.
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