Category Archives: Securities Fraud
The Role of “Whistleblowers” in Securities Fraud Cases
Congress passed the Dodd-Frank Act (DFA) in 2010 in response to the post-2007 financial crisis. The DFA included a number of provisions designed to strengthen regulation of the securities and financial industries. One such provision involved the use of “whistleblowers” in securities fraud investigations. Broadly defined, a whistleblower is anyone who provides “information relating… Read More »
Brokerage Firms Reminded – Senior Investors Must Be Treated Fairly
SEC Staff and FINRA Issue Report on National Senior Investor Initiative 04/15/2015 01:00 PM EDT With the Social Security Administration estimating that each day for the next 15 years, an average of 10,000 Americans will turn 65, the staff of the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) today… Read More »
Final Defendant Sentenced in Massive North Carolina Ponzi Scheme
Earlier this year, a federal judge in North Carolina sentenced the 11th and final defendant in a massive Ponzi scheme that cost investors upwards of $40 million. The so-called Black Diamond Ponzi Scheme conned about 400 victims with promises of significant profits through trading in foreign currencies. Unlike traditional securities markets, foreign exchange (or… Read More »
SEC Says Buffalo Man Running Ponzi Scheme
On Feb. 27, the U.S. Securities and Exchange Commission obtained an emergency order from a federal judge in Buffalo, freezing the assets of a venture capital fund manager accused of running a “Ponzi-like scheme.” Regulators believe the fund manager made false promises to investors about his ability to obtain pre-IPO shares of popular stocks… Read More »
SEC Puts a Stop to Colorado-Based Pyramid Scheme
If you are considering investing with a company that feels the need to proclaim, “We are not a pyramid scheme,” you may, in fact, be dealing with a pyramid (or Ponzi) scheme. Investors in one Colorado-based company probably wish they had considered that possibility as federal securities regulators recently moved in on the firm… Read More »
Another Man Sentenced in Connection with Billion-Dollar Florida Ponzi Scheme
On Feb. 20, a federal judge in Miami sentenced former attorney Frank Preve to 3½ years in jail for his role in one of the most infamous Ponzi schemes of all time. Preve is among dozens of people convicted of criminal charges in connection with the scheme, which was orchestrated by the now-defunct law… Read More »
Canadian Jury Convicts Two Men for Running $400 Million Ponzi Scheme
On Feb. 14, a jury in Calgary, Alberta convicted Gary Sorenson and Milowe Brost of securities fraud for their role in what has been described as the largest Ponzi scheme in Canadian history. Prosecutors for the Canadian Crown presented evidence Sorenson and Brost defrauded more than 3,000 people, including a number of U.S. residents,… Read More »
SEC, New York Charge Hedge Fund Manager With Fraud
On Feb. 13, New York officials arrested and charged Moazzam Ifzal Malik, also known as Mark Malik, with 28 felony counts arising from his operation of what federal and state officials allege is a fraudulent hedge fund. Malik is the CEO and fund manager of Wolf Hedge Investment Management, an entity the authorities claim… Read More »
SEC Cites “Lax” Oversight in Illegal “Trading Profits” Case
Investors should always be on the lookout for brokers who add charges to their stated commissions. Securities fraud does not always involve Ponzi schemes or people selling fictitious investments. Many times, there is fraud in routine, everyday transactions where a seemingly legitimate broker takes markups on trades without telling the investor. SEC v. Lax… Read More »
SEC Warns Investors Not to Fall for “Prime Bank” Scams
Securities fraud frequently involves misleading potential investors by using complicated-sounding language. After all, the more complex the investment sounds, the more likely it is to earn enormous profits, right? At least that is what the perpetrators of the fraud want you to believe. The U.S. Securities and Exchange Commission has identified a number of… Read More »