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David H. Schwartz Oct. 29, 2019

Your business can suffer severe damage as a result of poor financial advice or ill-advised investments. Sometimes the damage can be so severe that your business cannot recover without legal action. If your company has suffered monetary loss due to poor financial advice, you may be able to seek compensation to make your business whole again. Bay Area business litigation attorney David H. Schwartz can help you protect the future of your business.

California Securities Fraud Laws

Allegations of “bad financial advice” is a rather broad term, but under both federal law and the laws of the state of California, many unlawful financial practices are addressed under the definition of securities fraud. “Securities” is a term used to define financial investments such as stocks, bonds, options, and other investments. According to United States Sentencing Commission figures, 213 offenders were sentenced for securities fraud violations in the 2018 fiscal year. Violations of securities laws can come in many different forms, such as:

  • Insider trading (purchasing or selling securities while having confidential information regarding the stock)

  • Misleading actions or statements regarding the purchase or sale of securities (by a broker or a financial advisor)

  • Selling securities that have not been “qualified” according to the California Department of Corporations

California Corporations Code 25401 specifically identifies “...any written or oral communication that includes an untrue statement of a material fact or omits to state a material fact necessary to make the statements made...not misleading” as being unlawful and a violation of the state’s securities fraud laws. This statute provides a legal basis for taking action in response to your business suffering financial harm due to bad financial advice.

Can My Business Seek Damages?

If you file a claim on behalf of your business to sue for securities fraud, you could win compensation. Results that can be achieved by a successful securities fraud case can include financial damages to compensate your company for the losses suffered due to the fraudulent practices. In order to successfully win a case alleging securities fraud in California, you must prove one or more of the following:

  • The defendant actively participated in a fraudulent act

  • The defendant allowed false or misleading statements to be made

  • The defendant omitted or withheld information that affected investment decisions

The statute of limitations to make a securities fraud claim in the state of California is five years from the date of the violation, or two years from the date of the discovery of a past violation. The party found guilty of committing securities fraud may not only face civil or criminal charges in the state of California, but federal charges as well.

Why You Need an Attorney

California business laws are very nuanced and complicated. When your company is involved in a legal challenge, either as a plaintiff or a defendant, it is in your best interest to retain the services of a business litigation attorney who is skilled enough to allow you to focus on your company’s day-to-day affairs. Securities fraud and poor financial advice can cause irreparable harm to your business if you do not take legal action to address the damage. Do what’s right for you, your company, and your future. Put the skills of an experienced securities fraud litigation attorney on your side.

San Francisco Business Litigation Attorney

For over four decades, business litigation attorney David H. Schwartz has been fighting tough legal battles on behalf of San Francisco Bay Area businesses. David has the knowledge to aggressively protect the interests of your company in all aspects of complex business litigation. Your business deserves the best representation you can get. If your company has been damaged due to bad financial advice, including possible securities fraud, you need a business litigation attorney who will fight to win. For a consultation about your case, contact the Law Offices of David H. Schwartz today.