It is important for individuals who believe that they may be under investigation for wrongdoing – as well as individuals who have been formally charged with criminal wrongdoing – to understand the exact nature of their alleged crimes. Only when the nuanced nature of the crime at issue is fully understood can an individual hope to craft a potentially successful defense strategy with the assistance of an experienced legal professional.
For example, it is too vague to say that someone is under investigation for (or has been charged with) “securities fraud.” Securities fraud is not a single, definable act. It is an umbrella term that encompasses a variety of activities that can lead to misdemeanor or felony charges under certain circumstances.
The common thread that unites certain criminal activities as manifestations of securities fraud is that they involve – according to the Federal Bureau of Investigation – either the “deception of investors or the manipulation of financial markets.”
Common examples of securities fraud
Criminal offenses that fall under the umbrella of securities fraud are prosecuted as federal crimes. Common scenarios that lead to securities fraud charges include:
- Advanced fee schemes
- Broker-initiated embezzlement
- Foreign currency fraud
- Fraud related to hedge fund management
- High-yield-investment fraud
- Late day trading
- Ponzi and pyramid schemes
There is a common misconception that white-collar fraud, including securities and investment fraud, is not prosecuted with any sense of urgency and is not punishable in ways that are terribly consequential. It is important for anyone who is under investigation for – or who has been charged with – offenses classified as securities fraud to understand that these misconceptions are flat-out false.
Simply because white-collar crime is not always prosecuted aggressively, this does not mean that life-altering consequences cannot result from a conviction. As a result, it is important to seek legal guidance as soon as you suspect or know that you are in trouble so that you can craft a defense strategy.