New Financial Fraud Task Force Will Seek Criminal Penalties
Federal and state prosecutorial and enforcement organizations announced the creation of the Virginia Financial and Securities Fraud Task Force to investigate and prosecute financial fraud cases. Participating organizations include the U.S. Attorney, the SEC, the CFTC, the IRS, and Virginia regulators. According to the U.S. Attorney for Virginia, the Task Force will have wide jurisdiction: “The Eastern District of Virginia has the legal authority to bring cases here with national significance, regardless of where the fraud occurs.” Robert Khuzami, the SEC’s Director of Enforcement, said that the Task Force allows the SEC to threaten criminal penalties including prison time in situations where the SEC would otherwise lack criminal authority.
OUR TAKE: Adding the threat of criminal penalties, including prison time, certainly raises the stakes for those contemplating financial fraud.