People in a variety of industries may be at risk for being accused of securities fraud, wire fraud or other types of white collar crimes.
Florida entrepreneurs, executives and investors face a high level of scrutiny and regulatory oversight. Fairness and honesty in business practices is important yet so too is the ability to operate profitable companies. In some situations, the lines between these two priorities can become blurred.
Many white collar crimes arise out of the blurring of these lines. It is not difficult to find reports of people accused of unethical and even illegal business dealings in their efforts to make money for themselves and their companies. However, what may be difficult at times is learning what is really true. Defendants must always remember that what hits news headlines may only tell part of the story.
Three men involved in new securities fraud allegations
A new federal case has emerged against three men involved in a business in Colorado. The company, Fusion Pharm, sold special pots in which marijuana plants could be grown indoors. According to The Denver Post, the men are accused of working together to defraud investors over the span of three years from 2011 to 2014.
One of the men was the named chief executive officer of the company while another was allegedly involved in the creation of false documents intended to show profits and revenue that were fraudulent as legitimate. The third man, the brother-in-law of the CEO, was said to have been involved unknowingly to others at the time.
Case alleges stock sales masqueraded as revenue
CFO asserts that the men sold more than $12 million in Fusion Pharm stock that was restricted. The sales were said to have been to other companies controlled by the CEO and the stocks were then illegally sold again so that the money from those sales could be reported as income for the marijuana business.
The benefit of reporting stock sales as revenue was that the men could sell more stock at a higher price.
Bloomberg indicates that both civil and criminal charges have been filed though reports suggest an agreement has been made regarding the civil charges. The brothers-in-law are said to be facing wire fraud and securities fraud criminal charges. The men are also accused of not properly disclosing the CEO's involvement with other companies although the defendants are said to have kept information secret so as to not put off potential investors.
Complex situations require great care
There are many details of the Fusion Pharm case that have not been released. There may also be many details yet to be uncovered. What is known is that anyone in a situation like the defendants in this case should work with an attorney who is experienced in federal white collar crime charges. Getting the right legal help is essential when facing charges by the U.S. Securities and Exchange Commission.