Virginia Securities Fraud Laws

Statutes

• Va. Code Ann. Section 13.1-502 (unlawful offers/sales)
• Va. Code Ann. Section 13.1-503 (unlawful advice)
• Va. Code Ann. Section 13.1-504 (registration)

Elements of the Crime

Unlawful Offers and Sales

It is prohibited for any individual, relating to the offer or sale of any security (directly or indirectly) to engage in the following:

• Employ any device or scheme to defraud;
• Obtain money or property by means of any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in the light of the circumstance under which they were made, not misleading; or
• Engage in any transaction, practice or course of business which operates or would operate as a fraud or deceit upon the purchaser.

Unlawful Advice

The following activities are prohibited for an individual advising another person regarding the value of securities or their purchase or sale:

• Using any device or scheme to defraud another person;
• Engaging in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon another person; or
• Engaging in dishonest or unethical practices as defined by the State Corporation Commission

Registration

Registration is required to transact business in Virginia for the following individuals:

• For any individual acting as a broker-dealer or agent except in transactions exempted by statute.
• An investment advisor or investment advisor representative.
• A federal covered advisor unless they have filed documents and paid fees as required by the State Corporation Commission.

Possible Penalties

The actual penalties will depend on the specific circumstances of the case, but possible penalties include:

• Incarceration
• Fines
• Restitution to the victim
• Civil penalties

Related Offenses

• Money laundering: Va. Code Ann. Section 18.2-246.3
• Identity fraud: Va. Code Ann. Section 18.2-186.3