How is securities fraud committed?

Securities fraud is a white collar crime that involves the manipulation of the securities market. It is typically committed by traders, brokers, corporate executives, or others who seek to make a profit through illegal means. In California, securities fraud can be either an act or a practice that deceives investors and causes them to suffer significant economic losses. This includes making false or misleading statements, concealing information, manipulating the market, or otherwise controlling the price of a security or stock. Examples of securities fraud can include insider trading, front running, pump and dump schemes, and fraudulent financial reports. Insider trading is illegal when a person trades on non-public information that gives them an unfair advantage. Front running is a practice when a trader places orders in anticipation of a large order, allowing them to make a profit on the difference in prices. With pump and dump schemes, traders spread false or misleading information to drive up the price of a stock before they sell their own shares of the stock at a higher price. Finally, fraudulent financial reports are when overstated information is given to investors to mislead them into purchasing stock. Securities fraud is a serious offense and can be punished with steep fines and/or jail time. It is important to report any suspicious activities to the authorities to help protect investors from falling victim to this crime.

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