Investment Fraud Investigation
Investment fraud investigations are conducted for investors who suspect their funds may be at risk in an illegitimate or illegal offering, and for victims seeking financial recovery from collapsed or corrupt schemes.
Hudson Intelligence is a licensed investigative agency that works with law firms, financial institutions, securities regulators, federal receivers and private investors. Every investment fraud investigation is led by a Certified Fraud Examiner.
We have coordinated investigations of investment fraud with the Federal Bureau of Investigation (FBI), Securities and Exchange Commission (SEC), U.S. Attorney's Office, and state and foreign securities regulators.
Investment Fraud: Evaluate Risks, Recover Financially
Securities fraud, stock fraud and investment fraud are illegal practices in which investors are persuaded to enter investment contracts, or buy and sell securities, based on false or misleading information. Most investment frauds promise high returns with low risk. Their sales pitches may come unsolicited, by email or telephone, from unfamiliar companies or unregistered brokers. There is pressure to act quickly, before the 'opportunity' disappears, leaving no time for proper due diligence before capital is committed. These criminal schemes often cause significant financial losses.
The purpose of an investment fraud investigation is to determine what actually happened with the client’s funds – and who’s responsible – and provide a clear reporting of the evidence to support a positive outcome in settlement demands, civil litigation and criminal prosecution. The investigation may also involve tracing and locating assets to assist fraud victims in securing financial restitution.
In sum, I have found John Powers and Hudson Intelligence to be professional in every way. Their report was thorough and delivered exactly what we had been seeking. I would highly recommend them.
- Donna Trosin, Esq.
Conducting a Fraud Examination
During a fraud examination, our investigators gather and analyze the relevant facts of the investment scheme. We identify the responsible parties and confirm their involvement through independent investigation, fact-finding and interviews. We also document the extent of financial losses.
The formal findings of a fraud examination can provide valuable leverage for settlement negotiations and recovering funds from a failed scheme. When confronted with clear and convincing evidence of their wrongdoing – and their personal liability – even the most capricious fraudsters may choose to return investor funds rather than face the prospect of career-crippling lawsuits, regulatory enforcement or criminal prosecution.
If a fraudster refuses to return funds, then the expert investigation report becomes a critical tool for civil litigation or criminal prosecution, providing an easy-to-follow roadmap of complex schemes, bolstered by the testimony of a licensed investigator.
We have coordinated investment fraud investigations with federal law enforcement – as well as federal, state and foreign regulatory agencies – resulting in criminal prosecution and civil enforcement actions on behalf of our clients and other fraud victims.
Types of Investment Fraud
Most investment frauds are variations of a familiar theme. Their promoters often follow techniques of long-established schemes to solicit money and manipulate victims. Recognizing common types of investment fraud is essential for fraud detection, investigation and prevention.
Comprehensive Due Diligence and Background Investigation
Conducting comprehensive background investigations of key players – the companies and their principals – is essential for gauging the depth of corruption and misconduct in an investment fraud scheme. These insights can provide guidance for defrauded investors and their counsel in setting an appropriate strategy for legal action and financial recovery.
Comprehensive background investigations of principals will reveal criminal records, civil litigation, financial liabilities, employment history and professional credentials. Special attention is paid to any pattern of past involvement with similar frauds, including prior litigation by defrauded investors or enforcement actions by securities regulators.
Evidence of participation in past fraudulent schemes and related financial crimes can be valuable for persuading a judge or jury that a failed investment offering was not an unfortunate outcome of market forces, but was, in fact, a fraudulent program created and promoted with the intent to deceive.
This information can also be highly relevant in determining whether a formal complaint to law enforcement or regulatory agencies is merited. Cooperation of federal and state agencies may require compelling evidence that the matter merits an official inquiry within their jurisdiction.
The corporate background of any companies involved in the scheme are scrutinized for unregistered securities offerings, regulatory sanctions, bankruptcies, litigation and judgments. The investigation will also determine whether the companies are legally chartered – and identify their corporate parents, affiliates, subsidiaries and principals. Sophisticated frauds may involve several layers of shell companies, while other schemes use fictitious and fabricated company names to create a false impression of scale and legitimacy.
Financial Recovery and Restitution
For victims of investment fraud, one of the most important steps toward recovery – often a matter of great urgency – is figuring out where the money went, before it disappears forever.
Hudson Intelligence has led asset search and asset discovery efforts for victims of major international investment frauds. Our investigators have located assets totaling more than $300 million for clients.
We identify domestic, foreign and offshore holdings, including bank and brokerage accounts, business interests, personal trusts, real property, vehicles, airplanes and luxury assets.
Consult an Investigator
If you would like to discuss an investment fraud investigation, or an asset search for financial recovery, please complete the form below. You can also speak with an investigator by contacting our offices at 800-580-8755.