Securities Fraud is a very serious crime. In Arizona, the Securities Division of the Arizona Corporation Commission regulates securities activity taking place in the state. Both companies and individuals offering or selling these financial products to the public are overseen by this entity. When Securities Fraud allegations occurs, DM Cantor handles these claims and offers guidance regarding the Arizona Securities Act.
In Arizona, the Arizona Corporation Commission performs the following duties, among others:
- Registration and oversight of securities dealers and brokers
- Registration and oversight of investment advisors and representatives
- Review of prospective securities offerings for full and fair disclosure
- Review of offerings to ensure no fraud
- Oversight of securities
What Is Arizona Securities and Investment Fraud?
Securities Fraud occurs when a person is activity violating Article 13 of the Arizona Securities Act as part of Fraudulent Practices. Those who are accused of these crimes in State Court face a class 4 felony charge.
Securities Fraud is a classification of varied crimes involving (1) financial products and/or (2) commodities.
(1) Financial Products Fraud usually pertains to misinterpretation or falsification of information presented to future investors. This information may be exaggerated or inflated in order to entice new investors.
Violations of Investment Fraud
Violations under the Arizona Corporation Commission’s regulation of Investment Fraud include:
- Fact falsification
- Inaccurate information or partially accurate information
- Inaccuracy in presentation of assets and expected return
- Misrepresentation of liabilities and assets
- Production of false documentation
Violations in the realm of Investment Fraud are penalized through harsh federal and state sentencing. It is important to gain the help of an experienced Arizona Investment Fraud lawyer as early in your case as possible, such as when you are aware of an investigation or particularized suspicion. If you have already been charged with Investment Fraud or other securities violations, you need immediate help from an experience Arizona Investment Fraud lawyer.
Investment Fraud Prosecution
Both state and federal charges may result from Investment Fraud activities. Arizona securities violations fall under the regulation and oversight of the Arizona Corporation Commission. For federal infractions, the U.S. Department of Justice provides enforcement of violations regulated by the Securities and Exchange Commission (SEC). For federal cases, the SEC refers information to the USDOJ for prosecution in civil and criminal courts. These agencies of the state and country may work independently or in cooperation to achieve their objectives.
Stockbroker Fraud and Misconduct
Stockbrokers are obligated by their license to recommend investments suited to individual customers’ needs. These needs may be determined according to the customer’s:
- Financial status
- Tax status
- Investment goals
- Other investments held
- Experience in investing
- Available time for investment return
- Risk tolerance
- Needs for liquidity
A relationship with a stockbroker is one of integrity and trust. Beyond being trustworthy, stockbrokers must also:
- Consider their customers’ interests first, then their own
- Disclose risks
- Disclose all fees
- Recommend a wise investment strategy
- Offer only firm-approved products
(2) Commodities Trading Fraud is a type of Securities Fraud. These activities center on buying and selling of petroleum products, precious metals, agricultural products and other commodities. Violations within the realm of commodities trading include:
- Unauthorized trading, or trading of commodities without the consent of the owner
- Misrepresentation, providing false information to potential buyers of an investment
- Nondisclosure, withholding information from investors
- Funds misappropriation, embezzling or misappropriating investor funds for purposes outside of what those funds are supposed to be used for
Penalties for Investment Fraud in Arizona
Arizona penalties for Investment Fraud include those enforced by the Department of Justice on the federal side and the Arizona Corporation Commission on the state side. These penalties may include:
- Securities law violation restitution
- Cash equaling the fair market value with interest
- Rescission order for violator to repurchase securities
- Seizure of assets when rescission or restitution are not possible
- Holding violator in contempt
- $20,000 civil penalty per charge
- Costs and attorneys’ fees
- Restraining orders – both temporary and permanent
- Injunctions – both preliminary and permanent
- Civil liabilities, including:
- Right of investors to sue
- Penalties of as much as $5000 per violation
- Criminal liabilities, including:
Sentencing If You Are Convicted in State Court of Securities Fraud
If you are found guilty of Securities Fraud in Arizona, your violation of the Arizona Securities Act will likely be charged as a class 4 felony. This crime involves a possible sentence of 1.5 to 3.75 years or more in prison, with the crime being a permanent part of your criminal record. Conviction will present many problems in your life beyond just being incarcerated. You will likely also owe thousands of dollars in fines, if not amounts in the hundreds of thousands or even into the millions. How much you are ordered to pay will be dependent upon the factors of your case. You will lose your securities license and will not be able to trade securities in the future because of this loss. You may have to serve probation or parole and will face other sanctions and difficulties as a result of your felony criminal record.
You can be punished at both the state and federal levels for Securities Fraud. You can even be dually prosecuted by Arizona and the United States Government. If you are aware that you are under investigation for Securities Fraud, or if you have been accused or arrested on these charges, you need the immediate help of an experienced and aggressive Arizona Securities Fraud law firm such as DM Cantor.
Are You Accused of Securities Fraud?
There have been many nationally publicized and highly significant cases within the realm of Hedge Fund and Investment Fraud in recent years. You may have heard names like HealthSouth, ENRON and WorldCom mentioned in the news, in regard to their fraud cases. These cases and the passage of Sarbanes-Oxley has led prosecutors to become more energetic in pursuit of charges in Hedge Fund and Investment Fraud, such as those of accounting fraud, stockbroker fraud, and other financial crimes.
Although your case will likely not involve the billions of dollars of HealthSouth or ENRON, you still need the most aggressive and knowledgeable defense attorney Arizona has to offer. If you are worried about being a defendant in a Hedge Fund , Securities or Investment Fraud case, or if you are a subject of a white collar investigation that is being conducted, you need the aggressive White Collar Securities defense lawyers of DM Cantor.
The earlier in your case that you gain representation by an aggressive attorney, the better your chances of escaping the harsh penalties of Securities Fraud in Arizona.
If your Securities Fraud case is in the stage of open investigation, or you have been arrested for an alleged crime of Investment Fraud, contact us immediately for the skilled defense you need. There have been many cases in Arizona in which accusations of criminal activity were not justified. Your charges could be among those unfounded allegations. The lawyers of DM Cantor are highly proactive and thorough in their defense of clients accused of White Collar Crimes like Securities Fraud.
With the highest possible rating by Martindale Hubbell®, and as an AV ® rated law firm, DM Cantor has the legal skill you need on your side. The firm is also listed in the Criminal Law Section of the Bar Register of Preeminent Lawyers®. Call DM Cantor at 602-307-0808 or Contact Us for a Free Case Consultation.