ISRAELS & NEUMAN, PLC – South Dakota Securities Arbitration and Investment Fraud Attorneys
Section 501 of the South Dakota Uniform Securities Act
Israels & Neuman are securities arbitration and investment fraud attorneys that represent South Dakota residents who have been wronged by their stockbrokers and brokerage firms. We have previously invested investors throughout South Dakota, including a couple in the Rapid City area who had money stolen by broker Barkley Lundy, and another investor who lost money in a fraudulent oil and gas scheme.
South Dakota residents are protected by the provisions of the South Dakota Uniform Securities Act. This Act provides for the regulation of the sale of securities to South Dakota residents and to South Dakota financial advisors and stockbrokers. Additionally, the South Dakota Division of Securities, with offices in Pierre, was created to help enforce the provisions of the South Dakota Uniform Securities Act.
Section 501 of the South Dakota Uniform Securities Act provides for liability if a financial advisor, stockbroker, or investment advisor misrepresents the risks of an investment to you. In particular, this statute provides that:
General fraud. It is unlawful for a person, in connection with the offer, sale, or purchase of a security, directly or indirectly:
(1) To employ a device, scheme, or artifice to defraud;
(2) To make an untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or
(3) To engage in an act, practice, or course of business that operates or would operate as a fraud or deceit upon another person.
See SDCL 47-31B-501. The South Dakota Uniform Securities Law further provides civil remedies in the event that the Act is violated:
(b) Liability of seller to purchaser. A person is liable to the purchaser if the person sells a security in violation of § 47-31B-301 or, by means of an untrue statement of a material fact or an omission to state a material fact necessary in order to make the statement made, in light of the circumstances under which it is made, not misleading, the purchaser not knowing the untruth or omission and the seller not sustaining the burden of proof that the seller did not know and, in the exercise of reasonable care, could not have known of the untruth or omission. An action under this subsection is governed by the following:
(1) The purchaser may maintain an action to recover the consideration paid for the security, less the amount of any income received on the security, and interest at Category D, § 54-3-16 from the date of the purchase, costs, and reasonable attorneys’ fees determined by the court, upon the tender of the security, or for actual damages as provided in paragraph (3).
(2) The tender referred to in paragraph (1) may be made any time before entry of judgment. Tender requires only notice in a record of ownership of the security and willingness to exchange the security for the amount specified. A purchaser that no longer owns the security may recover actual damages as provided in paragraph (3).
(3) Actual damages in an action arising under this subsection are the amount that would be recoverable upon a tender less the value of the security when the purchaser disposed of it, and interest at Category D § 54-3-16 from the date of the purchase, costs, and reasonable attorneys’ fees determined by the court.
See SDCL 47-31B-509.
If your financial advisor or stockbroker makes misrepresentations to you when selling securities, he or she may be liable for your losses. In addition, the brokerage firm that your advisor works for may also be liable.
Israels & Neuman PLC is a securities arbitration and investment fraud law firm with offices in Denver, Colorado and the Seattle area. We represent investors in FINRA arbitration and securities arbitration proceedings in all 50 states, including representing investors previously throughout South Dakota, and in Sioux Falls, Rapid City, Aberdeen, Brookings, Watertown, Mitchell, Yankton, Pierre, Huron, and Spearfish. Our attorneys have represented over one thousand investors against many brokerage firms in the past, including LPL Financial, Merrill Lynch, Morgan Stanley, Smith Barney, Stifel Nicolaus & Company, UBS Financial Services, Oppenheimer, Charles Schwab, Wells Fargo Advisors, Ameriprise Financial Services, Raymond James, ProEquities, Securities America, National Securities Corp., and many others.
Click to view: South Dakota Act TOC
Click to view: South Dakota Anti-Fraud Provisions
Click to view: South Dakota Act Remedies
If you are a resident of South Dakota and have lost money with your financial advisor or investment advisor, please CONTACT ISRAELS & NEUMAN at 720-599-3505 for a free evaluation of your case.