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NYC Investment Fraud Lawyers

November 12, 2016 Federal Criminal Attorneys

Wall Street is located in New York, and it’s one of the most prevalent investment areas in the world. New York is considered the investment capital of the nation, and it comes as no surprise to anyone. The rules required to operate as a legal investment entity are numerous, binding, and upheld in a court of law. All businesses and people acting as investment firms are required to adhere to strict financial, legal, and ethical guidelines. Anytime a company or investor fails to adhere to these specific guidelines and laws, they are guilty of investment fraud.

What is Investment Fraud?

Investment fraud is any sort of misrepresentation to the client when an investment takes place. Some of the most common examples of investment fraud include:

– Ponzi schemes: This occurs when an investor accepts money from a client to invest in a specific product, but uses the money given by another client or company to pay off the investors who ask for their payouts rather than investing their money. Investors typically recruit additional clients to invest their money so they can use those funds to repay other clients.
– Advance Fee Fraud: This occurs when an investor requires a client to pay them a fee upfront before they actual invest any of their funds. The Federal Trade Commission deems this illegal under the scope of the law.
– Financial statement fraud: This occurs when investors falsify information on financial statements that go out to their customers in one of two ways. They can overinflate the earnings their customer’s investments bring in to keep their customers, or they can underinflate the earnings their customers have so they can pocket the difference.
– High-Yield investment fraud: When an investor promises their clients a high rate of return that borders on unrealistic without any substantial risk to the investor, it’s called fraud because they investor usually purchases investments that are unregistered and/or sold by those without a license.

When an investor or company knowingly and willfully engages in any of this type of fraud, they can be held responsible in a court of law, sent to prison, required to pay restitution, and they lose any professional licenses they hold. The purpose of investment fraud criminal punishment is to protect investors. When a person approaches an investor to help with their portfolio and funds, they do so with a reasonable expectation their funds are being appropriated in a specific manner. Their funds are not used to the financial benefit of the person or company working for the client.

Penalties for Investment Fraud

Both criminal and civil charges can be brought against any investor accused of fraud, and they can reach the federal level in many cases. The type of punishment a person faces when accused of investment fraud varies. There are several details, additional crimes, and smaller charges brought against those who commit investment fraud it’s nearly impossible to determine the charges for any specific case without the details. Investment fraud that occurs through the use of electronics can be further defined and charged as wire fraud. If it’s done through the mail, mail fraud is added into the mix. Anyone charged with investment fraud faces the following punishments

– Fines
– Prison time
– Restitution
– Probation

Fines for anyone who commits investment fraud starts at $10,000 and goes up depending on the charges. Restitution requires fraudsters pay back their clients they money they stole. Incarceration can start at just a few years and last as long as several lifetimes depending on the severity of the charges, and the number of charges and their maximum prison term allowed. Probation time is standard starting at 5 years and can increase based on the number of charges a person is found guilty of.

A successful investment fraud case is handled by utilizing the experienced of a knowledgeable criminal defense attorney. Being charged with investment fraud means a defendant accumulates debts usually unaffordable for them, prison time, and the loss of their professional licenses. The entire future for a defendant is determined in a case like this, and a lawyer who knows what he’s doing in the courtroom is beneficial to all defendants.



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