NASAA: States Doled Out $579M in Enforcement Penalties in 2014

Investigations and enforcement actions performed by state securities regulators in 2014 resulted in $405 million in restitution to investors — mostly elderly investors — as well as $174 million in fines and prison sentences of 1,629 years.

Those figures were released Tuesday by the North American Securities Administrators Association as part of its 2015 Enforcement Report on 2014 Data.

The report, which includes responses from 49 jurisdictions throughout the United States, found that frauds targeting seniors were the focus of one-quarter of the enforcement actions taken in 2014 by states that track victims by age. “This number is conservative, in part, because of a reluctance by victims to approach authorities,” said William Beatty, NASAA president and Washington Securities Director, in releasing the report, adding that senior-related cases typically involved an average of three senior victims per case.

Unregistered securities, in the form of promissory notes, private offerings or investment contracts continue to be the most common product involved in senior abuse cases, the report states.

Affinity fraud and unregistered securities scams disproportionately affect seniors, the report states, with more than half of all reported enforcement actions that involved a senior victim featuring unregistered securities.