Pennsylvania Securities Fraud State Laws

Securities fraud can have a profound impact on investors, especially those who entrust their life savings to a financial advisor. If you notice significant losses in your portfolio due to possible deceptive practices, seek immediate legal representation. Pennsylvania securities fraud state laws provide legal remedies against engaging in a wide range of fraudulent activities.

At Meyer Wilson, we focus exclusively on investor claims, which gives us a competitive edge over other law firms. Our Pennsylvania investment fraud lawyers offer personalized representation and compassionate support. After we review your case, we will explain in detail how Pennsylvania securities fraud laws impact your recovery. Call us today to schedule a free initial consultation.

What Is Prohibited Under Pennsylvania Securities Fraud State Laws?

Securities fraud laws safeguard investors like you from deceptive practices that could jeopardize their financial well-being. Understanding what is prohibited under these laws is essential for anyone engaging in securities transactions within Pennsylvania.

Fraudulent Activities Related to the Offer, Sale, or Purchase of Securities

One of the most relevant laws, 70 Pa. Stat. § 1-401, outlines the regulations governing the sales and purchases of securities within Pennsylvania. The section underlines the importance of fair dealings regarding securities transactions.

It is against the law for anyone in connection with the purchase, offer, or sale of securities in the state to directly or indirectly:

• Employ any scheme, device, or artifice to commit fraud.
• Make untrue statements about a material fact or omit to specify a relevant material fact.
• Engage in any act, practice, or course of business that operates or would operate as deceit or fraud upon someone.

Section 1-401 establishes the legal foundation for regulating sales and purchases of securities within the state. If you have been a victim of securities fraud, this law serves as a crucial tool for seeking legal recourse. Specifically, if the advisor is found to have been involved in any prohibited practices as outlined by the law, they could be held accountable under this section.

For instance, if your investment advisor misrepresented information about the security, Section 1-401 could be invoked to address these fraudulent actions. A securities fraud lawyer from our team can explain in more detail how this section applies to your case.

Market Manipulation

Strict regulations are in place to ensure the transparent functioning of securities markets. It is expressly prohibited for any individual, directly or indirectly, to engage in deceptive practices aimed at creating false or misleading appearances related to active trading or the market for a security.

Under 70 Pa. Stat. § 1-402, it’s against the law for anyone in Pennsylvania to:

• Make fake trades in a security to create a false appearance of active trading or affect the market for that security. This includes doing transactions that don’t change ownership or placing orders with the knowledge that similar orders from the same or related people will be entered at the same time and price.
• Engage in a series of transactions with others to create the appearance of active trading in a security or manipulate its price to encourage others to buy or sell.
• Persuade people to buy or sell a security by spreading information that suggests the price will go up or down because of market activities if the person spreading the information is also buying, selling, or getting paid by someone involved in those market activities.

Insider Information

Section 1-406, known as “Inside Information,” makes it against the law for certain individuals associated with a company (like officers, directors, or affiliates) to buy or sell that company’s securities in Pennsylvania. This rule applies if they have special access to important information about the company that the public doesn’t know.

Specifically, it’s illegal if they trade these securities while knowing this information:

• Would significantly impact the securities’ market price.
• Is not known by the public; and
• Is not meant to be public. However, if they have reason to believe the person they’re trading with also has this information, the rule doesn’t apply.

Civil Liabilities for Securities Fraud in Pennsylvania

If someone sells a security in a way that breaks the law, they can be held responsible. For instance, if they make untrue statements or fail to mention important facts, and you don’t know about these issues, the seller could be liable. You can then take legal action to get back what they paid for the security, along with interest, or ask for damages if they no longer own the security.

Investment advisors who violate the law may have to return the fees paid under their contract, and the contract can be declared null and void. If someone violates specific sections or makes untrue statements, they can be held liable for damages, and the buyer could get a refund, interest, or damages.

Meyer Wilson will help you hold them accountable and seek restitution. How much the at-fault party has to pay depends on the details of your case. Our dedicated team understands the complexities of civil liabilities regarding securities fraud and can help victims fight for justice.

Criminal Penalties for Securities Fraud in Pennsylvania

The consequences of intentionally violating the securities fraud laws are outlined in 70 Pa. Stat. § 1-511. The severity of penalties depends on the details of the offense and includes fines (which are usually between $250,000 and 10 million) and time in prison.

Securities fraud cases can be intricate, and having experienced legal professionals by your side is crucial. Our legal team is well-versed in the nuances of these laws, ensuring that you receive the guidance necessary to navigate the legal landscape effectively.

We Represent Pennsylvania Investors in Securities Arbitration and Litigation

The majority of securities fraud cases are handled through FINRA arbitration. This means that instead of going through a traditional court process, disputes are resolved through an arbitration panel. We have extensive experience navigating the arbitration process and representing clients who have been affected by securities fraud.

In situations where pursuing a resolution through arbitration may not be feasible or advisable, litigation offers an alternative for victims of securities fraud. Litigation involves taking legal action in a court setting, and our firm has a proven track record of effectively representing clients in securities fraud cases. A Pennsylvania securities litigation lawyer will help you recover.

Call Our Pennsylvania Securities Fraud Lawyers

At Meyer Wilson, we understand the complexities of securities law and are dedicated to helping clients navigate through legal challenges related to investment fraud and deceptive practices. Our experienced attorneys have a deep understanding of both state and federal securities regulations. We offer knowledgeable and strategic representation.

If you are a victim seeking restitution, our Pennsylvania securities fraud lawyers will provide effective legal counsel tailored to your specific situation. Don’t navigate the complexities of securities fraud cases alone; contact us for the advocacy and guidance you need.