Investing in publicly traded companies is a cornerstone of our economy, and subject to heavy regulation. Investors have a legal right to full, truthful disclosure and transparency regarding securities. As an investor, you are protected under the law. The executives who are responsible for publicly traded companies hold the duty to reveal true facts about their products, whether to individual or institutional investors.
At Morgan & Morgan, our securities litigation team is recognized for their ability to take on high-stakes investment fraud cases and prevail. To learn more about how we may be able to help, complete our totally free case review form
Legal Protection for the Rights of Investors
When investor rights have been violated, there are often devastating losses. These losses can be widespread – and could impact the economy itself, as was seen in the mortgage industry meltdown in 2008. Federal lawmakers have passed and amended several laws, any of which may have been violated in a case of securities fraud. The pertinent laws include:
- Securities Act of 1933
- Securities Exchange Act of 1934
- Sarbanes-Oxley Act of 2002
- Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
Securities law and capital markets are part of an extremely complex system, and litigation will require experience, as well as keen intelligence, and the ability to craft and present a fully developed, compelling case. The attorneys at Morgan & Morgan have decades of experience in this area of law, and are available to represent either individual or institutional shareholders.
The goal of our securities litigation team is to protect help those who have suffered losses due to violations. Our securities litigation lawyer can help you pursue justice and compensation if you have been a victim of an illegal practice. All investors have the right to complete and accurate information. If you have been misled, it is imperative that you get qualified counsel at to represent you without delay.
Securities Litigation: What is Fraud?
Securities fraud is often also called stock or investment fraud, and occurs when investors are deceived into making investments, based upon false or misleading information. Investments typically carry some degree of implied risk, but when certain risks of loss have been deliberately hidden from the investor, securities law has been violated.
Securities fraud encompasses many activities, including the following:
- Embezzlement by stockbrokers
- Stock manipulation
- False statements on financial reports
- Manipulation of auditors
- Insider trading
- Churning
- Stockbrokers private purchases for their own advantage based on client knowledge.
The types of securities fraud that will require litigation are as various as there are ways to make money. It has been estimated by the Federal Trade Commission that investment fraud in the United States ranges from $10 to $40 billion in losses every year. As the securities and commodities markets are based on reasonable prediction of profit, these acts of fraud destroy investor trust.
Types of Securities Fraud
- Corporate fraud: High-level misconduct including a wide range of false reporting. Can also include selling securities for dummy corporations.
- Internet fraud: The dissemination of false data through internet venues to artificially pump up the price of a security before dumping it.
- Insider Trading:: Trading of large blocks of corporate stock by that corporation’s insiders or the purchase/sale of securities based on privileged information.
- Microcap fraud: The false inflation of stock value through deceptive promotion to a misled public so that the perpetrators can then dump the stock at a large profit.
- Accounting fraud: Allowing the falsifying of financial reports by corporations that alter the company’s financial status.
- Ponzi schemes: Where withdrawals are financed by subsequent buyers there is no real profit, and investors who have been caught in one of these schemes can lose it all, as was so prominently revealed in the Madoff case.
Securities Litigation: Class Action Cases
Our securities litigation attorneys bring powerful skills to the table to help protect you as an investor. We use the Securities and Exchange Commission’s “Rule 10b-5” to litigate cases associated with the purchase of securities. These are typically filed as class action cases, and related to the following illegal actions now covered under this rule:
- Cases of insider trading: If an officer, director or any corporate insider either purchases or sells that company’s securities, based upon the possession of material that is not available to the public or other investors, it is a violation.
- Cases of the issuance of misleading information: Corporate executives, under this rule, cannot be silent and fail to disclose information to investors that could impact the value of shares.
- Cases of selective distribution of material: Corporate insiders are restricted from tipping off certain investors.
- Cases of corporate mismanagement: If a director or officer of a corporate entity are engaged in mismanagement associated with the purchase or sale of securities, and failing to act in the best interests of stockholders.
We are the legal professionals you need to zealously protect your rights and interests, and to take action to hold those who have engaged in illegal activities accountable. Whether your case will be filed in state or federal court, our nationwide securities litigation team has the knowledge, skill, and experience you need on your side. We offer a free case evaluation to assist you – call now for more information on our St. Augustine attorneys.