What are the federal statutes governing investment fraud?

Investment fraud involves the deliberate misrepresentation of facts or omissions of material information made by an individual or firm to another individual or firm in a financial transaction. It is an illegal activity governed by state and federal laws. In the state of Florida, federal statutes governing investment fraud are enumerated in the federal securities laws, primarily the Securities Act of 1933, the Securities Exchange Act of 1934, the Investment Advisers Act of 1940 and the Investment Company Act of 1940. The Securities Act of 1933 was established to provide investors with material information concerning investments and to enhance the accuracy and reliability of the disclosure, preventing fraud in the offer and sale of securities. This law requires any company that wants to offer its securities publicly to register with the SEC, meaning that the company must provide detailed information about itself and the securities it is offering for sale. The Securities Exchange Act of 1934 requires broker dealers, exchanges, and other securities market participants to register with the SEC and comply with rules that promote fair trading and prohibit fraud. This law also created the Securities and Exchange Commission (SEC), the primary federal regulator of the securities markets. The Investment Advisers Act of 1940 mandates that any person or firm that provides investment advice to others must register with the SEC or their state securities regulator, unless they are exempt from SEC registration. This law provides a regulatory structure designed to limit unethical practices and protect investors. The Investment Company Act of 1940 requires that companies that invest money for other individuals or institutions register with the SEC and submit to regulation. This law protects investors by requiring registered investment companies to provide disclosure about their operations, so that investors may make better educated decisions.

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What are the federal statutes governing investment fraud?

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