Stock Broker Fraud, Deceptive Investing Tactics Among Types of Corporate Fraud
As the financial crisis has crippled the United States economy, many desperate investors have fallen prey to unscrupulous investment brokers, dishonest corporations, and other shady financial industry professionals. The sale of unsuitable investments, the failure to disclose the risks of certain investments, and other illegal, unethical activities have cost investors and consumers billions of dollars in savings, college funds, retirement accounts, and other funds. Some of the nation’s largest investment houses, including Bear Stearns and Lehman Brothers, have been involved in corporate and investment fraud scandals.
The securities industry is closely regulated by the government and by industry licensing bodies, which impose professional and ethical rules for brokers. When securities brokers break the law or violate industry standards in their dealings with clients, they can face criminal prosecution, fines, and the loss of their broker’s license, among other penalties. Meanwhile, investors who lose money as the result of illegal or unethical conduct by their brokers may be able to recover their financial losses.
Types of Corporate Fraud
Stock broker fraud and the mismanagement of investment accounts can occur in the following ways:
- Sale or offering of auction rate securities
- Offering of investments that are unsuitable for the client
- Sale or offering of variable annuities
- Churning of the investment account with unnecessary activity to earn commissions
- Unauthorized trades
- Abuse of margin accounts
Consumer Fraud
Many consumers are victims of shady company billing practices, deceptive marketing techniques, and other illegal tactics. Internet coupon offers may be used to trick consumers into enrolling in membership programs and allow unauthorized charges to be made to the consumer’s credit card. In many cases, defrauded consumers who were victims of fraudulent or dishonest business practices can recover their losses.
Topics in this category
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States Sue Amgen for Drug Sales Kickback Scheme
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A Drop in the Bucket: Madoff Victims Paid Just $534 Million
Only $534 million has been approved as payment to victims of convicted Ponzi schemer Bernard Madoff, who is serving life in prison after admitting he ripped off thousands of investors to the tune of about $65 billion, officials said.
Stanford Ponzi Scheme Lawsuits Consolidated Into Texas MDL
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Two Madoff Victims Sue SEC Seeking Return of $2.4 Million Lost
In what may be the first drop in an expected flood of such lawsuits, two former investors who lost millions in the Ponzi scheme run by Bernard Madoff have sued the Securities and Exchange Commission seeking return of their lost investments.
SEC Dropped the Ball on Madoff – Again, Again and Again, Officials Say
A new report out today on the Securities and Exchange Commission’s handling of the Bernard Madoff $65 billion Ponzi scheme finds financial regulators repeatedly failed to uncover the fraudster’s historic rip-off.
Guess Jeans Co-Founder Ordered to Pay $55 Million to Former Employee for Libel
Regular readers of www.attorneyatlaw.com may remember the case of Guess Jeans Co-founder Georges Marciano, who was ordered last month to pay over $370 million to five former employees of the company for defamation. Marciano was sued for accusing the employees of stealing millions in artwork and funds.
Madoff’s Right-Hand Man Pleads Guilty in Massive Ponzi Scheme
The man who served as a top deputy to admitted Wall Street swindler Bernard Madoff pleaded guilty today to charges he helped carry out the record-setting $65 billion Ponzi scheme.
