Securities fraud refers to deceptive acts or practices that are used to scam people out of large sums of money. Fraudulent acts like making illegal investments or inflating stocks to force others to buy into them, only to sell right after, are considered securities fraud. Tricking investors while withholding information or not sharing the whole picture about an investment opportunity could result in severe legal consequences. If you want to protect yourself, your business, or others from securities fraud, here are some common schemes to look out for. 

Misleading Financial Statements

Companies are required to submit different financial statements to the government, their financial department, and others in order to keep everything in check. Misleading documents that report overstated earnings or omit crucial assets are considered fraudulent. Hiding liabilities, overstating earnings, or minimizing assets can put a company and its investors at risk of large financial losses. Reporting all assets and money that a company has will improve its integrity and prevent securities fraud.

Failure To Disclose Risks

An insurance broker or financial advisor could omit important information from financial records that can show the risks of making a specific investment. Failure to disclose this information could result in damage to the health and longevity of a company. Securities fraud due to failure to disclose risks is often a big financial hit to an investor or a company. Any misleading information or withheld information about the investment someone is about to make could be considered fraud.

Insider Trading

The most common type of securities fraud is insider trading, which involves company insiders sharing non-public information that will help them sell or buy the company’s stock. Lawyers, board members, or company accountants who share this confidential information are guilty of securities fraud because it often gives them a step up in trading and buying stocks. Retail investors are often left in the dark and can experience financial losses when investing in a company’s stock. 

Market Manipulation

Individuals who interfere with the natural flow of the stock or securities market can be guilty of securities fraud. Manipulation often looks like spreading misinformation about the company’s profits, spreading rumors about a company merger or acquisition, and talking down about a company’s performance to help lower their stock market price. Buying and selling rapidly can also be a form of market manipulation, making it difficult for typical investors to buy stocks at a fair price. Anything that tips the scales in favor of the individual to make the stock prices unfair constitutes securities fraud.

Affinity Scams

This specific type of fraud preys on identifiable groups and exploits their trust. A fraudulent individual may present an investment opportunity with exaggerated potential returns. They may also hide risks or potential drawbacks of the investment to make it appear favorable. These investments go right into the fraudster’s pocket, rather than investing in a company or stock. Affinity scammers may give some of the original investment back to the group to create an illusion of “returns,” but will ultimately steal the rest of the group’s investment.

Unregistered Securities

All securities must be registered in the United States in order for them to be sold or traded. Unless a special exemption is given, securities need to be registered in order to prevent fraud. Unregistered securities should be a major red flag for investors, as these are not controlled or reviewed by the SEC, meaning they could be worth less than your investment or a risky product. Unregistered securities could range from investments in a start-up to investments in a product stock. 

What To Do If You Suspect Securities Fraud?

If you suspect securities fraud or think you have been a victim, it is important to report it to the SEC immediately. The Office of the Whistleblower may also be able to help you get some of your investment if the scam was over $1 million. 

If you believe that you have caught a fraudulent scheme before it comes to fruition, work with your company’s lawyer or outside legal team to stop the scam from happening. Because company lawyers may also be a part of securities fraud, you may consider outsourcing if you suspect they are involved in fraud. 

Attorneys from a trusted law firm can help you look for evidence and can protect you or your investors from losing money. The sooner you contact a legal expert, the lower the risk of financial ruin. 

Legal Help From WW Partners

Our legal team is here to protect your investments, stocks, bonds, and other securities. WW Partners is proud to serve our local communities and businesses, providing them with comprehensive legal advice and litigation services. Don’t be a victim of securities fraud and ensure that your business is safe from insider trading or other fraudulent schemes. Reach out and get to know our lawyers today!

There is often confusion around the differences between trademarks and copyright, but they are in fact two different legal concepts that protect different property. Protecting your intellectual property is important, no matter what industry you are in. When someone violates your rights, takes your property, or participates in copyright infringement on your intellectual property, they may face different penalties depending on whether you have established a trademark or a copyright.

Working with business lawyers when it comes to intellectual property and trademarks will save your business from irreversible damage. WW Partners knows the ins and outs of trademark and copyright infringement, so this blog will provide insight into how the two protections differ and how infringement is handled.

What Is Copyright?

Copyright is a legal protection granted to the original creators of a tangible work, like music, photographs, film, and software. When it comes to copyright protection, the creator will have exclusive rights to reproduce and distribute the work for financial gain. When you have copyright protection, you can perform or reprint your works for financial gain without consequence. If someone reproduces your work or tries to profit from your original idea, you can seek legal action. 

What Is A Trademark?

A distinctive sign or symbol that companies attach to their product or services will help them to be easily identified. Trademarks are often attached to logos, brand names, and other unique identifiers, like a character. Trademarks help to save a brand’s reputation and prevent confusion over the quality or type of product for consumers. When someone steals your trademark or tries to replicate your project, people will know that it is not the original because of the missing brand colors, font, or characters. Competitors won’t be able to steal your customers when you have a trademark in place.

Examples Of Infringement

Before you can take legal action, if you believe that your work or creation has been infringed on, it is important to look at examples of both types. Common examples of copyright infringement include:

• Downloading music without paying
• Pirating movies
• Selling copyrighted artwork
• Plagiarizing articles, books, or blogs
• Posting stolen images on your social media
• Sampling part of a song or musical without proper licensing
• Making and distributing copies of TV programs or radio

Popular examples of trademark infringement include:

• Confusingly similar names
• Copying a logo or using a similar pattern in your logo
• Use the prefix of a trademark (Mc for items from McDonald’s)
• Mimicking a brand’s well-known name or product

Are Infrigements Addressed Through Lawsuits?

The first step if you suspect you have experienced infringement is to send a cease and desist letter to the infringing party. This often saves you the money and time that comes from seeking a legal case, and gives the infringer the ability to stop their illegal activity calmly and quietly. However, if an infringing party pushes back or the resale has spread far and wide, you may need to seek litigation. 

Proof Of Infringement

If you want to take a competing company to court for stealing your work or creating something too similar to your idea, you will need proof. Not only will you need proof of the infringement, but you will also have to provide documentation that shows you own the trademark or have copyright privileges of the original piece. Before taking your case to court, proof of the infringement, proof of copying and distribution, or proof of the likelihood of consumer confusion should be gathered.

Trademark And Copyright Help From WW Partners

WW Partners can help you deal with copyright and trademark infringement that comes from selling your products or services. Our team can help you navigate the litigation process and help you understand the legal jargon that comes with it. Our legal experts will prevent damage to your reputation and loss of revenue by providing dedicated support through every step of the process.

WW Partners serves the community of Salt Lake City to help protect their businesses and intellectual property. If you need to register a trademark or are dealing with stolen copyright, we have the industry knowledge to help you get a successful result from your legal case. Fill out our contact form to get started.