According to the North American Securities Administrators Association (“NASAA”) 2015 Enforcement Report on 2014 Data (the “Report”), state securities regulators conducted 4,853 investigations in 2014 resulting in $405 million in restitution, $174 million in fines and 1,629 years in prison sentences. The primary targets of those state enforcement actions were unregistered individuals followed by unregistered firms. According to the Report, licensed individuals made up 230 of the enforcement actions involving broker-dealer agents, 190 actions involved investment adviser representatives, 156 involved broker-dealer firms, and 146 involved investment adviser firms.
The Report concluded that senior citizens are consistently targeted for fraudulent schemes involving unregistered securities such as promissory notes, private offerings or investment contracts. More than half of the reported enforcement actions in 49 jurisdictions involved seniors. “Seniors remain a top target of investment fraud and protecting seniors from investment fraud and abuse is a key priority of NASAA and its members,” said William Beatty, NASAA President and Washington Securities Director.
Beatty also stated that “Investors continue to rely upon their state securities agencies to provide frontline enforcement resources to protect them.” States received over 11,000 complaints from investors in 2014. 2,857 securities licenses were withdrawn and 728 were denied. Respondents were also required pay almost $42 million in costs or expenses. To Read the report in its entirety, please click here.
Most states have provisions designed to eliminate securities-related fraud. Some state laws also may include registration requirements for those securities that are traded within the state.
Jacko Law Group, PC (“JLG”) can assist your firm with understanding the significant differences from state to state regarding registration or licensing requirements.
For more information or to speak with a securities attorney on this and other related subjects, please contact us at firstname.lastname@example.org or (619) 298-2880.