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Washington Securities Fraud Laws

Financial investments, such as stocks or bonds, are referred to as securities. Securities fraud occurs when false or misleading statements are made about a company or the value of its stocks for the purpose of persuading people to make financial decisions based on the false or misleading statements. Securities fraud can cause significant financial damage, which is why there are securities laws at the both the state and federal levels.

The U.S. Securities and Exchange Commission is responsible for enforcing federal securities laws while the Washington State Department of Financial Institutions (DFI) regulates state chartered financial services and also provides education to protect consumers from financial fraud. The Securities Act of Washington governs securities and prohibits various practices relating to securities. The prohibited practices are divided into the following categories:

  • Unlawful offers, sales, and purchases;
  • Unlawful acts of people advising someone else;
  • Unlawful acts of investment advisers; and
  • Unlawful purchases or sales for customer's account.

An Overview of Washington Securities Fraud Laws

Legal research should involve reading the applicable laws, but sometimes those laws can be tricky to understand because they're written in "legalese." For this reason, it can be helpful to also read a summary of the laws in plain English. Below you'll find key provisions of securities fraud laws in Washington as well as links to relevant statutes.


Washington Revised Code:

What's Prohibited?

It's unlawful to do any of the following (directly or indirectly) in connection with the offer, sale, or purchase of a security:

  • To employ a scheme or device to defraud;
  • To make a false statement of a material fact or omit a material fact; or
  • To engage in a practice, act, or course of business that operates as a fraud on any person.
Charges and Penalties

Violation of Section 21.20.010 is a class B felony punishable by a maximum prison term of 10 years and/or a maximum fine of $20,000.

Related Statute(s)

Washington Revised Code:

Note: State laws are always subject to change through the passage of new legislation, rulings in the higher courts (including federal decisions), ballot initiatives, and other means. While we strive to provide the most current information available, please consult an attorney or conduct your own legal research to verify the state law(s) you are researching.

Washington Securities Fraud Laws: Related Resources

If you'd like more information related to this topic, please click on the links below:

Get Legal Help with Your Securities Fraud Case in Washington

Being convicted of a white collar crime can have serious consequences on your life, both financially and professionally. If you've been charged with violating Washington securities fraud laws, it's a good idea to consult with a skilled white collar crimes lawyer near you who can explain the possible penalties if you're convicted of the crime and assist you in developing your defense to the charges.

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