What is securities fraud, and is there a difference between federal and state securities fraud?
Dallas criminal defense attorney, John Teakell, discusses securities fraud in Texas and federal securities fraud.
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Phone: (214) 523-9076
Securities fraud is a misrepresentations in some form or fashion regarding a security. A security in federal law is a very broad, broadly defined term. It has a very broad definition. It could be a stock or a bond as people normally think of a security but it’s also been held as a promissory note or an investment contract, so to speak could be deemed to be a security, so you have the United States Securities and Exchange Commission who starts civil enforcement actions which sometimes turns into federal criminal cases referred to the US Attorney’s offices or the Department of Justice. In the state system you have state securities boards or the equivalents thereof who do the same thing. Their definitions of securities are broad in themselves. For federal securities law, federal securities prosecutions, he has some sort of misrepresentation, some sort of scheme to commit fraud regarding a security, that’s what you see as far as the reasons cases are prosecuted as securities fraud. You commonly see charges such as selling securities without a license, fraud in the sale of securities, things of that nature.