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Securities fraud and criminal charges

On Behalf of | Aug 19, 2022 | Criminal Defense, Felonies, White-Collar Crime

Investors rely on a company or firm’s honesty when making investment decisions. If a corporation or its representatives make false statements designed to sway investor decisions, the responsible parties could face more than a civil suit. Prosecutors may file securities fraud charges in an Illinois federal court. A conviction may lead to massive fines and a lengthy prison term.

Securities fraud and investor woes

These are several ways a company or broker could commit securities fraud. Providing investors with false information about revenue and expenses may lead them to believe the company is more stable and profitable than it is. So, they might purchase more shares instead of selling them and suffer losses. Ultimately, any false information presented to investors may be securities fraud.

Insider trading represents another form of securities fraud. Many people engage in insider trading, the act of buying or selling stock based on confidential information, even though the Securities Exchange Commission keeps an eye out for such behavior. Perhaps the desire for profit moves such decisions on an insider trader’s part.

Facing charges of securities fraud

Proof of securities fraud is a white-collar crime that requires a prosecutor to prove a case. With fraud-related offenses, the prosecution typically must prove intent and knowledge. In other words, mistakes might be negligent but not fraudulent.

An investigation may result in claims of fraudulent intent, but the accused could prove otherwise. Hopefully, the proof might come soon enough to end the investigation before an indictment. Even after a formal indictment, the case may end in the accused’s favor.

Any misconduct by law enforcement officials might tarnish evidence and make it inadmissible. Evidence-based on false witness statements or claims could also lead to a dismissal or not guilty verdict.