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Why is inadequate disclosure unethical?

On Behalf of | Oct 25, 2021 | White Collar Crimes

Securities fraud can disrupt your career and ruin your reputation. Dealing with the ramifications of your behavior could last years and make it difficult to achieve professional success the way you once did.

Understanding why inadequate disclosure is a form of securities fraud may help you to identify your next steps.

Methods of deception

Withholding information from your investors is a form of deception. If you avoid sharing critical aspects of a securities sale, your investors may lose money. According to the FBI, high-pressure sales tactics, unsolicited investments and misusing personal information are all unethical and can have substantial legal consequences.

Even if you have information that you feel is irrelevant at the time or you feel that sharing it may jeopardize an opportunity, maintaining transparency may be the only thing preventing legal trouble.

Consequences of deception

Unfortunately, if you do not have adequate documentation to back your story, you could face charges of securities fraud. Especially if your investors claim that you withheld pertinent information from them. You may need to take time away from work to organize your case and participate in court proceedings. If people find out about your pending charges, they may lose trust in you or form irrational judgments that impact your credibility. In serious cases, you may lose your job and struggle to maintain your career.

Even though securities fraud is a serious crime, you deserve the right to a fair trial. Working with an attorney may improve your confidence in your ability to present your case to the court. Despite the outcome, your effort to take ownership for your actions and rebuild trust may help you to minimize collateral damages to your personal and professional life.