Category Archives: Stockbroker Fraud
Precious Metals Futures Fraud
The Commodity Futures Trading Commission (“CFTC”) established the Precious Metals Fraud Advisory to alert customers to precious metals fraud and lists of recognized frauds and scams. The advisory also posts blogs and tips on simple ways to spot precious metals scams. The CFTC implemented several customer protections advisories to provide various warnings on popular… Read More »
Federal Agencies Focus on South Florida Securities Fraud
In December 2010, several federal government agencies began cooperating with each other to combat securities fraud. Known as the “Southern District of Florida Securities and Investment Fraud Initiative,” or just “the Initiative,” this effort has had tremendous success in the last three-and-a-half years. Recently, the Initiative reported that eighty-five defendants have been charged since… Read More »
FINRA Alerts Investors to Ebola Stock Scammers
Media outlets throughout the world continue to report on the tragic Ebola outbreak still ravaging West Africa. As recently reported, over 1,200 people have been killed since the virus began rapidly spreading in December 2013—and almost twice that number have been sickened. The virus itself does not appear to be directly affecting the United… Read More »
Retirees Particularly Vulnerable in 401(k) Rollovers
America’s population of retirees is larger than ever. According to U.S. News and World Reports, in the decade between 2000 and 2010, the 65-and-over demographic jumped by over 15 percent—significantly greater than the 9.7 percent increase of the total population. Not surprisingly, Florida leads the nation in retirees, with 17.3 percent of its population… Read More »
Supreme Court Upholds and Adjusts “Fraud on the Market” Theory
On June 23, 2014, the United States Supreme Court issued its ruling in the case of Halliburton v. Erica P. John Fund, Inc., closing the door on a question of extreme importance to securities fraud law. At the heart of the Halliburton case was a legal theory known as “fraud on the market.” As… Read More »
Florida “Blue Sky” Laws
The federal government’s authority over the U.S. securities market is far reaching. The FBI and the Justice Department investigate allegations of fraud. The Securities and Exchange Commission polices industry professionals and wrongdoing investors. Even FINRA’s oversight of brokers and brokerages has its roots in a federal law requiring its existence. Indeed, the federal securities… Read More »
Dark Pools Brought Further into the Light
In recent years, more and more securities have been traded away from the public eye, exposing markets to new kinds of possible securities fraud. As Bloomberg reported in 2012, only 68 percent of all trades occurred on public markets, like the NASDAQ or New York Stock Exchange. This number, down from 74 percent as… Read More »
Power of “Failure to Supervise” Affirmed by Federal Appeals Court
When one person is wronged by another—in the securities context or otherwise—fault can sometimes be placed at the feet of more than just the person who actively committed the wrong. For example, the courts and the regulatory agencies overseeing the financial markets (including FINRA and the SEC) have long recognized “failure to supervise” as… Read More »
The Frequency of Ponzi Schemes
Not every Ponzi scheme—a fraudulent financial operation where the operator pays returns on old investments from new investors—makes the national news. Certainly, the implosion of Bernie Madoff’s scheme in 2009 was uniquely destructive. Investors with Madoff lost approximately $17 billion (the next worst Ponzi scheme of all time also unraveled in 2009, with $7… Read More »
Top 10 Investor and Small Business Threats
The North American Securities Administrators Association (“NASAA”)—of which Florida’s Office of Financial Regulation is a member—is an organization made up of state securities regulation agencies. It endeavors to root out financial and securities fraud. And every year, the NASAA releases a helpful top 10 list of the “financial products and practices that threaten to… Read More »