Desperate people often resort to desperate measures to meet their needs. In many cases, however, these situations become catastrophic for trusting investors who give custody of their money to criminals, reports Russell Grantham of the Atlanta Journal-Constitution, Sunday, April 12, 2009, Business, in an article entitled “Desperation Feeds Rising Rates of Fraud.”
Financial fraud was on the rise well before the Madoff scandal made the headlines. The Federal Bureau of Investigation reported that corporate fraud more than doubled from 279 cases in 2003 to 529 in 2007, according to the article. The financial frauds include various forms of theft, such as Ponzi Schemes and embezzlement.
The down market “exposes more of those frauds,” said Katherine Addleman, director of the Securities and Exchange Commission’s Atlanta regional office. [The criminals] run out of money literally,” added Alana Black, a senior trial attorney in the SEC’s Atlanta office.
Victims are typically provided with guarantees against loss and promised high rates of return that seem “too good to be true.” Another distinguishing hallmark of these crimes is that the criminal or his company (rather than a large institution) gains custody of the investor’s money. Investors who engage an investment advisor to handle their money should make certain that their funds are held in an account at a reputable firm. While investors can certainly become victimized even when a firm with a “household name” has custody of their money, the opportunities for theft of the funds increases dramatically when an investor gives custody of his or her money to an individual or an investment firm that is not a household name.
Page Perry is an Atlanta-based law firm with over 125 years collective experience representing investors in securities-related litigation and arbitration. While past results are not indicative of future success, Page Perry’s attorneys have recovered over $1,000,000 for clients on more than 30 occasions. Page Perry’s attorneys are actively involved in representing institutional and individual investors in securities cases. For further information, please contact us.