Investment fraud is when a broker or financial firm makes false promises to their customers and then sells them either ill-advised or phony investments in order to benefit or harm the victim. There are many different ways in which investment fraud could occur, and sometimes those who have offered legitimate investment opportunities may be accused of fraud if the investment doesn’t work out or the investor simply doesn’t understand what’s happening with their money. The complexity of some of these schemes is what makes these cases so intimidating and difficult to navigate, but rest assured there are defenses available that you and your attorney may be able to utilize and effectively fight back to preserve your innocence. Here are just a few of the most common ones.
Unintentional Misinterpretation of Information
Brokers or financial professionals who make a reasonable and honest attempt to advise their clients and invest their financial resources properly are have not actually committed any offense. If the accused and their counsel can successfully demonstrate that they made any of their recommendations in good faith and that no intentional or reckless misinterpretation or misrepresentation of information occurred that caused an investor to suffer a financial loss, then no crime has actually been committed. In other words, honest incompetence is not considered fraud and therefore not illegal.
No Financial Loss Occurred
In order for fraud to be charged, a broker must have caused one of their clients to actually suffer a financial loss due to willful and deliberate misrepresentation of information. If you can demonstrate that no actual losses occurred, then no defrauding occurred either, and therefore no actual crime was committed.
Loss Wasn’t Due to Supplied Information
The stock market is a fickle beast and what appears sunny and rosy one day may quickly plunge into nothingness the next, resulting in devastating losses for all investors involved. Some frustrated investors may accuse their brokers of fraud when this happens, but unless the broker knew the crash was imminent and still deliberately misrepresented the status of an investment for their own benefit, then no fraud actually occurred. The stock market can change and investments can fail, but investment fraud can only be charged when a broker or financial professional misleads investors and either causes this failure or gains from it in some way.If you’re accused of investment fraud, get help from a Nassau County criminal defense attorney! Consult with Foley Griffin, LLP today by dialing (888) 966-8480 for a case evaluation.