What is the Punishment for Securities Fraud? Corporations Code 24501

January 21, 2023

Securities fraud is a serious crime that can result in severe penalties for those found guilty. In California, securities fraud is governed by the Corporate Securities Law of 1968, which is found in the California Corporations Code. Section 25401 of this code specifically addresses the punishment for securities fraud.

Securities fraud occurs when a person or entity intentionally misrepresents or omits material information in connection with the sale of securities. This can include making false statements, failing to disclose important information, or using manipulative tactics to inflate the value of a security.

The punishment for securities fraud under California law can vary depending on the specific circumstances of the case. Generally, securities fraud is considered a felony offense, which carries a potential jail sentence of three years. In addition to jail time, those convicted of securities fraud may also be required to pay fines, restitution, and other penalties. However, a misdemeanor conviction carries up to 12 months in the county jail.

One of the key elements in determining the punishment for securities fraud is the amount of money involved in the crime. For example, if the fraud involves more than $500,000, the potential prison sentence may be increased to up to eight years. Additionally, if the fraud involved multiple victims or a particularly vulnerable victim, such as an elderly person, the punishment may be more severe.

Another important factor in determining the punishment for securities fraud is the offender’s prior criminal history. Repeat offenders may face harsher penalties, as may those who have a history of financial crimes.

In addition to criminal penalties, those convicted of securities fraud may also face civil penalties. This can include being barred from working in the securities industry, as well as being required to pay restitution to any victims of fraud.

It is important to note that securities fraud is a complex area of law, and the specific punishment for a particular case will depend on a number of factors. An experienced criminal defense attorney can help those accused of securities fraud to understand the potential penalties they may face, as well as to mount a strong defense against the charges.

Contact a Southern California Criminal Defense Attorney for Help


If you’ve been accused of California securities fraud, then contact the Law Offices of John D. Rogers today. Call us to schedule a free confidential consultation about your options. Attorney John D. Rogers is an experienced criminal defense attorney and board-certified criminal law specialist.  

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