Federal Laws that Firms and Their Brokers must Follow

In 2003, a stockholder of the biopharmaceutical company ImClone Systems was convicted of insider trading due to her selling of her stocks after a broker at Merrill Lynch informed her that the chief executive officer (CEO) of ImClone Systems sold all of his company shares. The convicted stockholder made an early sale, selling 4,000 shares of her stocks which saved her losing as much as $45,673. Punishments for her conviction included payment of a $30,000 fine and five months imprisonment.

The crime insider trading refers to the unfair practice of making investment decisions based on undisclosed (not yet made public) information about a company’s securities or stocks. An insider has access to valuable non-public information on stocks or other securities of the corporation. It can either be a person (like a broker, a client, a key employee, an executive, a director or a major owner of stocks) or an entity (such as bank, a law firm or a government institution). There are two reasons why insider trading is illegal: it gives tipped individuals market advantage over common investors (this weakens the sense of fairness in investing); and, it violates the trust investors place in the securities market.

Not all acts of insider trading are illegal, though. Its legal version is when corporate insiders, officers, directors, employees and large shareholders, buy and sell stock in their own companies. When corporate insiders trade in their own securities, they must report their trades to the SEC.

To determine illegal insider trading activities, the SEC monitors the trading volumes of stocks. Volume of stocks usually increases after information on company securities is released to the public. If volumes increase dramatically, however, even when no substantial information has been released, this will be interpreted by the SEC as a warning flag. This will then be investigated by the SEC to find out if illegal insider trading was committed.

According to securities fraud lawyers of Erez Law, the Securities and Exchange Commission (SEC) and other organizations set federal regulations for brokers, investment advisers, and firms in the United States. A few of the federal laws that firms and their brokers must follow include:

  • Securities Act of 1933. This act requires brokers to give financial and other significant information about securities offered for public sale. It also prohibits misrepresentation, deceit, and fraud in the sale of securities.
  • Securities Exchange Act of 1934. This act created the SEC. The SEC has the power to oversee and regulate brokerage firms, ensuring they abide by the rules.
  • Investment Company Act of 1940. This act minimizes conflicts of interest between companies that engage in securities trading. It requires companies to disclose their investment policies and financial status to investors on a regular basis.
  • Investment Advisers Act of 1940. This act regulates investment advisers, requiring that any firm or sole financial adviser compensated for giving advice about securities investments be registered with the SEC.

These four acts describe a few of the dozens of laws that people and companies in the securities industry must follow. In addition to federal securities laws, every state enacts their own securities law. An attorney who specializes in broker misconduct will have a comprehensive list of all laws and regulations that brokers and brokerage firms must follow and can help you explore all your legal avenues. Contacting an attorney about your losses will give you a better idea of your recovery options.

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Hit-and-Run

A hit-and-run is the Illegal activity wherein an individual causes an accident yet refuses to stop and provide appropriate identifying information between him and the other participant of the crash. Rather than assume liability, the individual continues driving. According to Mazin & Associates, such individuals unfairly diffuse the responsibility of the accident to the innocent party. The term hit-and-run may conjure an image of an assailant fleeing the site of a major accident. This is not always the case. The underlying concept of a hit-and-run is not the extent of damage caused by the accident, but rather the action of fleeing the scene. In this way, if an individual performs a minor accident such as a small fender-bender or accidentally bumps into a parked car and fails to leave a note with appropriate personal and financial information, then he or she has engaged in a hit-and-run. Similarly, if you are the victim of an accident, and you do not disclose personal information to the wrongdoer, then you have committed a hit-and-run. In summary, anyone involved in an accident, whether the offender or the victim, is capable of engaging in hit-and-run.

When an accident occurs, the participants involved acquire the appropriate information i.e. insurance cards and personal contact information and, dependent on the state, they must alert emergency services. When an individual does not do this, then he or she must face certain penalties. The penalties from fleeing from a scene vary widely by state. The classification of hit-and-run are dependent on the damages accrued, some are felonies while others are misdemeanors. Again, the monetary penalties of a hit-and-run vary by state with some ranging up to $20,000. Apart from the financial consequences, the wrongdoer is also subject to suspension of his or her driver’s license for a specified amount of time dependent on circumstances of the accident as well as the state in which it occurred.

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What To Do If You Were Misclassified As An Independent Contractor?

For most employees, not getting the right wage is an injustice. You work hard for 8 hours and even work overtime if necessary only to end up not being paid the wage they deserved. This is a longstanding problem that has plagued the American workforce. The website of William Kherkher reveals that misclassifying a regular employee as an independent contractor leaves them out on many important benefits.

For many employers, such practice saves them a lot of money so that even if the employee should be treated as such under the law, companies are willing to break the law just to save some money. The US Department of Labor revealed that around 10 to 30% of employers misclassify their employees. IN four states that have conducted studies, it was found out that around 1.8 million workers were found to have been misclassified.

As an employee, what can you do to recover the wages you have lost? First, try to talk to your employer. Clarify with them your real classification with them. Explain to them that you think they have wrongly classified you as an independent contractor. After all, you deserve an explanation from them why they consider you as a contractor than an employee.

If talking to your employer does not solve the problem, get the attention of the IRS. You can ask the agency to determine your employment status for the purpose of taxation. You can file IRS Form SS-8 and there is no fee for doing so. Upon receipt of your complaint, the IRS will call your employer in order to determine what your status should be. The decision of the IRS shall be binding on the agency and not on your employer. However, non-compliance by an employer can have legal ramifications.

If you were fired or laid off by your employer, you can file for an employment insurance claim. Tell them that you were misclassified as a contractor. If after the investigation and the state unemployment agency deemed that you should be treated as an employee, you will be entitled to receive your backpay as well as insurance premiums.

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Types of Visitors in a Premise Liability Claim

Property owners have the responsibility to ensure that your premises are safe for your tenants. This is also the assumption that they will have once they occupy one of your units. But at the same time, visitors also have a reciprocal duty of care towards the property owner. When this responsibility is breached, the tenant or visitor can file a premise liability claim.

According to the website of Karlin, Fleisher & Falkenberg, LLC, it is the duty of property owners to ensure the proper upkeep and maintenance of their surroundings. However, the liability of the property owner depends on the legal status of the visitor. Generally, there are three types of visitors in a property:

Invitee

An invitee enters the premises for business purposes at the owner’s request. Examples of an invitee include customers, contractors, sales people, repair men, and others.

Licensee

This is a person who was invited at the premises by the property owner through invitation. For example, there is a party at the property. A licensee can make the property owner liable if they are able to prove three elements:

  1. The owner was aware of any condition or would discover the condition and realizes or should realize that it has an unreasonable risk of harm to the licensee
  2. There is an expectation that the licensee will not discover or realize the danger or will fail to protect themselves from it
  3. The owner failed to show reasonable care to protect the licensee from potential risks

Trespassers

A trespasser is neither an invitee nor a licensee so the property owner does not have any duty of care to them. If they get injured while inside the premises, they cannot file a claim. However, the owner cannot deliberately make the surrounding risky for trespassers. If he does so, the trespasser can make him civilly and criminally liable.

While they are just visitors to the premises, they have the legal duty to mitigate any injuries. They should take reasonable precautions to prevent injury. If the visitor gets injured, they should properly treat the injury or else they could not make the property owner liable.

Likewise, in most states, comparative fault is adopted. Thus, if the visitor was partially or fully responsible for their injuries, they cannot recover damages.

 

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Seat Belt Defect: Cause of Thousands of Fatal Car Crashes Annually

If the same problem has been the reason why a group of vehicles of the same design has been involved in an accident, then it may be necessary that such vehicle be recalled. Vehicle recalls, according to the National Highway Traffic Safety Administration (NHTSA), may be necessary:

  • If the defect complained about poses a risk to the safety of the driver, passengers or anyone else on the road
  • If the vehicle itself or any of its parts does not comply with the minimum performance requirement set by the Federal Motor Vehicle Safety Standards (FMVSS). These standards help make sure that a vehicle can be operated safely and that the driver and passengers would have enough protection from serious injury or death in the event of a crash. Thus, there are standards for tires, brakes, lighting, child restraints, air bags and safety belts, among others.

Vehicle recalls usually happen due to complaints consumers make to the vehicle manufacturer or to the Office of Defects Investigation (ODI), a department of the NHTSA. Regarding safety belts or seat belts for example, Chrysler, specifically, is said to have recalled (in October of 2014) about 184,215 SUVs around the globe due to defective airbags and seat belts; this is besides the more than 850,000 Ford vehicles that were recalled a month earlier due to the same problems.

Seat belts are still considered the best protection for drivers and passengers during car accidents. This is because these crash-safety devices protect drivers and passengers from hitting with great force any of a car’s interior parts (such as a door window, dashboard, or windshield) after the primary impact, that is when a car hits another vehicle or object. But while seat belts may be said to save thousands of lives, there have also been instances when it was rather the cause of injury or death – due to defects.

A defective or malfunctioning seat belt, may be due to poor manufacturing or poor design, can cause a person to suffer serious injuries during a secondary impact (when he or she slams into an interior part of a vehicle, or is thrown outside, smashing into the windshield and then with whatever thing in the exterior environment). In fact, every year, at least 10,000 (of the more than 30,000) individuals who die in car crashes are said to have died due to faulty seat belts.

The Massachusetts car accident lawyers at Crowe & Mulvey, LLP, know for a fact that all those who purchase vehicles fully assume that the vehicle, with all its parts, is in good operating condition, has complied with all the safety requirements set by the FMVSS and is free of any defect. While it can be said that no one more than the manufacturers would want their vehicles to be defective and, worse, be the cause of accidents and injuries, thorough tests on their vehicles’ design and performance may just show a flaw they never think might exist. In short, despite the never-intended defects, once an accident occurs, its consequences would be on their shoulders.

The website yvonnefraserlaw.com also shares vital information on accident victims’ right to file a lawsuit against manufacturers of defective vehicles in order to seek compensation for all the injuries, pains, sufferings and damages resulting from the accident.

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