{"id":371837,"date":"2016-04-11T01:21:01","date_gmt":"2016-04-11T06:21:01","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/state\/california-law\/california-securities-fraud-laws0.html"},"modified":"2016-06-20T19:51:09","modified_gmt":"2016-06-21T00:51:09","slug":"california-securities-fraud-laws0","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/state\/california-law\/california-securities-fraud-laws0.html","title":{"rendered":"California Securities Fraud Laws"},"content":{"rendered":"\n
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California Securities Fraud Laws<\/h1>\n
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Created by FindLaw’s team<\/a> of legal writers and editors<\/i><\/p>\n\n | Last reviewed\n

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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

With the wide variety of online stock trading sites available these days, almost anyone can sign up for an account and call themselves a day trader. However, making a profit on the stock market is not quite as simple. Most traders rely heavily on tips and advice when buying and selling the stocks in their portfolio.<\/p>\n

California securities fraud<\/a> laws protect traders from advisors utilizing fraudulent tips and advice as a way to swindle traders out of their money. This is a quick summary of the securities fraud laws in California.<\/p>\n

Protecting Stock Prices With California Securities Fraud Laws<\/h2>\n

While protecting consumers from fraudulent advice is an important aspect to California’s securities laws, these laws also make it unlawful for traders to manipulate securities in a manner that creates a false or misleading appearance of stock activity. The following table outlines the specifics of securities fraud laws in the Golden State.<\/p>\n\n
Code Sections<\/b><\/td>\n

California Code – Part 5<\/a>: Fraudulent And Prohibited Practices<\/p>\n<\/td>\n<\/tr>

What’s Prohibited?<\/b><\/p>\n<\/td>\n

Under California law, it is unlawful for any person<\/a>, in connection with the offer, sale, or purchase of a security, directly or indirectly, to do any of the following:<\/p>\n

Criminal Penalties<\/b><\/p>\n<\/td>\n

Any person who willfully violates<\/a> California’s securities laws will be fined up to $10,000,000, imprisoned for two, three, or five years, or both. However, no person may be imprisoned for the violation of this rule if he or she proves that he or she had no knowledge of these securities fraud laws.<\/p>\n<\/td>\n<\/tr>

Civil Liabilities<\/b><\/p>\n<\/td>\n

Any person who willfully participates in any act that violates California securities fraud laws will be liable to any other person for the damages<\/a> sustained as a result of the act. Damages will be the difference between the price at which the person purchased or sold securities and the market value of the securities at the time of his purchase or sale, plus interest at the legal rate.<\/p>\n<\/td>\n<\/tr><\/tbody><\/table>\n

If you have been charged for violating securities fraud laws and would like legal assistance, you can contact a California securities fraud lawyer<\/a> through FindLaw. Visit FindLaw’s sections on securities fraud<\/a> and other fraud and financial crimes<\/a> for more articles and information on this topic.<\/p>\n

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