White Collar Crime: Federal and Ohio: Securities Fraud & Insider Trading

Securities Act of 1933

Securities Exchange Act of 1934

Manipulation of security prices

The Stock Act clarified that insider trading laws also apply to members of the US Congress.

This section criminalizes violations of the Securities Acts above.

Employment of manipulative and deceptive devices.

Division of Enforcement. A federal case for securities fraud typically begins with an investigation by the Securities and Exchange Commission (SEC).In its regulatory role, the SEC has legal authority to compel production of records and other disclosures, enjoin market activity, and seek civil penalties such as fines. These functions are civil in nature and, as such, do not implicate a penalty of imprisonment for a violation of securities laws. However, the SEC can refer any alleged violation of securities laws over to the Department of Justice (DOJ) for criminal prosecution.

From the Securities and Exchange Commission

American Bar Association, Derivatives and Futures Law Committee, Innovative Digital Products and Processes Subcommittee
Jurisdiction Working Group, March 2019

is a self-regulatory organization that oversees and regulates the actions of its members. Members of FINRA include exchange markets and brokerage firms. This private corporation used to be known as the National Association of Securities Dealers.

3/27/19 Supreme Court rules that defendant can be charged with violating federal law barring fraudulent securities schemes if he distributed, but did not make, false statements.

2023 US Supreme Court cases rejected a lower court ruling that had substantially broadened liability for publicly traded companies under Section 11 of the Securities Act of 1933. That provision imposes liability for false or misleading material in a statement registering securities with the Securities and Exchange Commission. The justices ruled on Thursday that the provision permits lawsuits only by those who purchased the securities registered under that statement.

Reuters 12/12/22

Dept of Justice 6/6/22

Reuters 8/24/20 SEC seeks to limit the scope of sensitive information required by a massive new industry trading database, the Consolidated Audit Trail (CAT), conceived to help the regulator better police the markets.

DOJ press release 11/12/19

SEC Press Release 12/9/19