Securities Fraud A Brief Overview of Recent Cases

Maryland securities fraud lawyer

The stock, or commodities market, has experienced a considerable amount of securities fraud over the past few years. Also known as stock fraud and investment fraud, this is a deceptive practice which has cost investors billions of dollars.

Furthermore, this practice not only violates securities laws, it also violates the trust that investors place in the firms with which they invest. In brief, these investors were provided with false information, which they then used in their decision-making process when determining whether or not to sell or purchase stock. As a result of this fraud, investors often experience frequent financial losses.

Recent Case Statistics

During the 2012 fiscal year, 734 enforcement actions were filed by the SEC. This resulted in disgorgement and penalties orders that totaled over $3.1 billion.

In the 2013 fiscal year, the SEC filed 686 enforcement actions. The disgorgement and penalties orders totaled $3.4 billion.

In the 2014 fiscal year, there were 1,639 pending commodities and securities fraud cases. There were also 633 pending corporate fraud cases.

Recent Case Examples

During the fiscal year of 2014, there were a record number of actions filed by the SEC. This included 755 enforcement actions for various types of misconduct. The SEC obtained an estimated $4.16 billion in disgorgement and penalties from pursuing these actions.

Cases brought against the Bank of America, Morgan Stanley, and Deutsche Bank by the SEC all resulted in the payment of penalties and/or the return of investment funds to investors.

In 2014, the Bank of America had additional charges filed by the SEC. This was part of a global settlement where the Bank of America admitted that it failed to inform investors regarding financial uncertainties in the mortgage loan business. This occurred during the financial crisis, when the Bank of America was ethically and legally bound to divulge this information and did not. As a result, the bank agreed to pay $20 million in penalties.

Another 2014 case was against three Morgan Stanley firm entities. The SEC charged them with misleading investors as well. In this case, the misleading information pertained to the delinquency status of mortgage loans which these Morgan Stanley firms had underwritten, sponsored, and issued. The charges were settled, and Morgan Stanley paid $275 million to investors that had been harmed by their actions.

In 2015, a case was filed by the SEC against Deutsche Bank AG. It was found that this bank had also withheld vital information during the financial crisis. Deutsche Bank provided inaccurate, or misstated, information on its financial reports, and paid a $55 million penalty.

When financial fraud of this nature occurs, a securities fraud lawyer or a stockbroker fraud lawyer can provide the necessary counsel. While the magnitude of the fraud may not be at the level discussed above, consulting with a securities fraud attorney as well as a financial advisor attorney may prove to be helpful.

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