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State Securities Investigations

State Regulatory Investigations and Litigation Attorney Representing Financial Professionals

If you are involved in an investigation conducted by state securities regulators, you need to be advised and represented by an experienced state regulatory investigations and litigation attorney.

In addition to the federal securities laws enforced by the Securities and Exchange Commission (SEC), every state has its own set of securities laws commonly referred to as “blue sky” laws, and each state has securities regulators who are responsible for protecting investors in that state.

Which Investor Complaints are Investigated at the State Level?

State securities regulators investigate investor complaints, enforce securities laws, and impose penalties on individuals and firms who violate state securities laws. Securities regulators at the state level investigate an extensive range of complaints regarding (but not limited to):

  1. affinity fraud and financial exploitation of the elderly
  2. unregistered firms or individuals offering securities
  3. fraudulent securities offerings
  4. omissions and misrepresentations in securities transactions
  5. fraudulent cryptocurrency activity
  6. real estate investment fraud
  7. “Ponzi” schemes and “pyramid” schemes
  8. market manipulation

States often conduct coordinated investigations with each other, with the SEC, or with self-regulatory organizations. State regulators can provide information that they obtain to state and federal criminal law enforcement agencies.

What are “Blue Sky” Laws?

The state laws that govern the issuance and trading of securities are commonly referred to as “blue sky” laws. Blue sky laws protect the general public from fraud by regulating the offering and sale of securities.

The blue sky law in Illinois, for example, provides that certain types of securities cannot be sold until the issuer has filed a sworn statement with the Secretary of State that describes the securities, the issuer’s financial history, and the backgrounds of the firm’s management team.

Similar laws are in effect in all fifty states. State-level disclosure laws generally require firms to disclose all material facts relating to an offering. About forty states also enforce merit review laws which regulate the merits and fairness of securities offerings to investors.

The exact provisions of blue sky laws vary among the states, but all states require the registration of all securities offerings, stockbrokers, and brokerage firms operating within their state. Under blue sky laws, issuers, brokers, and others can be liable for fraudulent statements or omissions made in connection with the offer, purchase, or sale of securities.

Who Can Help You With a State Regulatory Investigation?

State regulatory investigations of alleged securities law violations can be as complex as investigations by the SEC.  Depending on the complexity of a particular case, state regulatory investigations can last anywhere from a few weeks to several years. Sometimes state regulators file emergency actions demanding that certain conduct in their state “cease and desist.”

If you are involved in any way in a state regulatory investigation, it is imperative to be advised and represented by the right lawyer – right away.

As a former Branch Chief in the Division of Enforcement of the Chicago Office of the SEC, Lisa Bragança has handled scores of regulatory investigations. She is also the former Chair of the Chicago Bar Association Securities Law Committee and is active in the Women’s White Collar Defense Association.

As a state regulatory investigations attorney, Lisa Bragança has the legal background and experience to represent effectively those who are involved in state regulatory investigations in all fifty states.

How are State Regulatory Investigations Conducted?

Investors and the public can submit complaints or tips to state securities regulators. States may receive tips or complaints from self-regulatory organizations like FINRA, or from federal and state agencies like the SEC or a state attorney general. State investigators may issue subpoenas, question witnesses, and compel the production of documents related to the case. Generally, state regulators will investigate only if they determine that the conduct took place in their state or affected investors in their state.

State securities regulators can also work with the Federal Bureau of Investigation, the Internal Revenue Service, and postal inspectors.

How are State Regulatory Investigations Resolved?

When state securities regulators find no regulatory violations, they can simply shut down an investigation. That is why it is important to work with these regulators early in the process. However, if evidence of regulatory violations is discovered in the course of an investigation, securities regulators at the state level may file charges and seek penalties.

Often, state securities regulators will attempt to resolve a complaint informally with a negotiated settlement, but it is not always possible to reach an acceptable settlement. In that case, the state could file an administrative action against you.

If evidence of regulatory violations is proven, an administrative law judge or state court could order you to pay restitution and substantial fines. Under some state statutes, like New York’s Martin Act, a state securities regulator may have the authority to bring criminal charges.

Why is an Experienced Attorney’s Help so Imperative?

State securities regulators also have the authority to revoke, bar, or suspend the licenses of individuals and firms that violate securities laws. These penalties can very negatively impact your finances, your career, and conceivably even your freedom.

That is why, if you are involved in a state-level regulatory investigation, you must be advised and represented by an experienced state regulatory investigations and litigation attorney who is committed to bringing your case to its best possible outcome.

Having an experienced and reliable attorney working on your behalf during a state regulatory investigation can make the difference. A mistake at any stage in the investigatory process can negatively affect the outcome of your case. Do not let this happen to you.

You’ll Need Your Own Attorney – Not Your Employer’s

If you are investigated by a state securities agency, you should not rely upon your firm’s attorneys to represent you. Any mistake in the investigation can destroy your career.

You’ll need an attorney who represents and looks out for you – not for your employer. Your employer and/or the state may tell you that you are not the focus of the investigation of the firm, so you don’t need your own attorney. That is not true. When your firm’s attorneys prepare you for an interview or accompany you for on-the-record testimony, they represent the firm – not you. Be wary of your firm making you a scapegoat and throwing you under the bus. If your firm’s attorneys will not put IN WRITING that they are representing you as an individual in the investigation, get your own attorney.

Throughout her career, attorney Lisa Bragança has protected the careers and reputations of individuals in federal and state regulatory investigations and actions.

Attorney Lisa Bragança handles not only state regulatory investigations but also SEC investigations.

Here’s How to Reach Us at Bragança Law LLC

If you are involved in an investigation conducted by state securities regulators, or if you need to learn more about state regulatory investigations, arrange now to discuss your circumstances with experienced regulatory investigations attorney Lisa Bragança at Bragança Law LLC.

Call Bragança Law LLC at (847) 906-3460, or use the contact form here on our website. When you become a client at Bragança Law LLC, attorney Lisa Bragança will explain how the law applies to your case, and what she can do to get you the best possible resolution.

If you need to speak with an experienced attorney about your involvement in a regulatory investigation at either the state or federal level, make the call to Bragança Law LLC right now.

Client Reviews

Celiza was a great help to me in the course of working to resolve my problem. She was very patient, explaining in detail what was happening and what would follow, doing it in a very professional and friendly...

Barbara M.

As an investor and fiduciary, I have worked with Lisa in several capacities over the last 15 years. Lisa’s diverse background from her tenure as an attorney for the SEC, and in private practice – working on...

Jason M.

Lisa is a strong and tireless advocate. She helped guide me through a complicated investor disclosure issue on a publicly-traded security. Her practical counsel on process--and avoiding unnecessary legal...

Lee B.

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