Securities & Investment Fraud Defense Lawyers
Under investigation by the Arizona Corporation Commission, the SEC, or a prosecutor for securities or investment fraud? Criminal securities fraud under A.R.S. § 44-1991 is a Class 4 felony and is often charged alongside fraudulent schemes and money laundering. These cases run on parallel civil, regulatory, and criminal tracks, what you say in one can sink the others. Do not give testimony or documents before you speak with a defense lawyer.
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What Is Securities Fraud in Arizona?
Quick answer: Securities fraud under A.R.S. § 44-1991 is making untrue statements of material fact, omitting material facts, or engaging in a scheme to defraud in connection with the offer, sale, or purchase of a security. Arizona also criminalizes selling unregistered securities (44-1841) and acting as an unregistered dealer or salesman (44-1842). A willful violation committed with intent to defraud is a Class 4 felony under A.R.S. § 44-2036, and the same conduct is regularly charged as fraudulent schemes (A.R.S. § 13-2310), a Class 2 felony. These cases are expert-heavy, run on parallel civil/regulatory/criminal tracks, and turn on materiality and intent.
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Former Prosecutors · Law Enforcement · Public Defenders
When you call Tamou Law Group, you reach a firm that handles criminal defense exclusively, with serious experience defending securities fraud and other white-collar cases across Arizona. Our team includes former prosecutors and law enforcement officers, so we know exactly how the State builds these cases, and where they fall apart.
At many large firms, the name on the building is a marketing figurehead, you rarely get them on the phone and your case goes to a junior associate. When you hire Tamou Law Group, your case is handled by a full team of attorneys, not associates, including Michael Tamou.
On This Page
- What Is Securities Fraud in Arizona?
- Is securities fraud a felony in Arizona?
- How much prison time can you get for securities fraud in Arizona?
- How does the State prove intent in a securities fraud case?
- Is a failed investment the same as securities fraud?
- What are the strongest defenses to securities fraud?
- Will a securities fraud conviction end my financial career?
- How the Charge Sets the Securities-Fraud Exposure
- Penalties & Sentencing
- Defenses That Work
- Our Defense Team
- FAQs
If you’ve been charged with securities fraud in Arizona, you probably have urgent questions about what you’re facing and what comes next. Here are straight answers to the questions people ask most, with a plain-English breakdown of the law under A.R.S. § 44-1991, the penalties, and the defenses that matter most.
Is securities fraud a felony in Arizona?
Yes. Willful securities fraud committed with intent to defraud under A.R.S. § 44-1991 is a Class 4 felony under A.R.S. § 44-2036. The same conduct is almost always also charged as fraudulent schemes (A.R.S. § 13-2310), a Class 2 felony, so your real exposure usually comes from the stacked counts rather than the securities count alone.
How much prison time can you get for securities fraud in Arizona?
A standalone Class 4 securities-fraud conviction carries roughly 1 to 3.75 years for a first offense and is often probation-eligible. If it is charged alongside fraudulent schemes as a Class 2 felony, the range jumps to about 3 to 12.5 years, and stacked money-laundering counts or federal securities and wire-fraud charges can push your exposure far higher.
How does the State prove intent in a securities fraud case?
The State must show you acted “willfully” and with intent to defraud — a knowing, deliberate deception, not an honest misjudgment. An honest mistake, a disclosed risk, or a good-faith belief in the venture is not a crime. Intent and materiality are the two hardest elements for prosecutors and are where your defense is built.
Is a failed investment the same as securities fraud?
No. A losing investment, by itself, is not a crime. Securities fraud requires a material misrepresentation or omission made with intent to defraud, so market losses, honest mistakes, and properly disclosed risks are all defenses. A valuation expert can show that investor losses were market-driven rather than the result of fraud.
What are the strongest defenses to securities fraud?
The core defenses attack materiality and intent: that you had no intent to defraud, that any misstatement or omission would not have mattered to a reasonable investor, that the risks were adequately disclosed in subscription documents, or that the instrument was not legally a “security” at all. For registration counts under A.R.S. §§ 44-1841 and 44-1842, establishing a valid exemption can defeat the charge.
Will a securities fraud conviction end my financial career?
Likely. A conviction brings a permanent record, a lifetime bar from the securities industry, loss of professional licenses, restitution to investors, and possible asset forfeiture. Regulatory bars from FINRA, the SEC, or the Arizona Corporation Commission can end a financial career independent of any criminal sentence, so protecting your licensure is a central goal.
How the Charge Sets the Securities-Fraud Exposure
Securities fraud is typically a Class 4 felony on its own, but the fraudulent-schemes and laundering counts charged alongside it carry much higher exposure.
| Statute | Conduct | Felony Class | First-Offense Range* |
|---|---|---|---|
| A.R.S. § 44-1991 / 44-2036 | Willful securities fraud | Class 4 | 1 – 3.75 years |
| A.R.S. § 44-1841 | Selling unregistered securities | Felony | Varies |
| A.R.S. § 44-1842 | Unregistered dealer / salesman | Felony | Varies |
| A.R.S. § 13-2310 | Stacked fraudulent schemes | Class 2 | 3 – 12.5 years |
| A.R.S. § 13-2317 | Stacked money laundering | Class 2/3 | Enhanced + Forfeiture |
*Ranges are for a first offense and vary with priors, loss amount, and aggravators. Federal securities and wire-fraud charges can add far higher exposure.
What the State Must Prove for Securities Fraud
To convict you of Securities Fraud under A.R.S. § 44-1991, the prosecutor must prove every one of these elements beyond a reasonable doubt. If even one fails, the charge fails.
- 1In connection with a security. The matter involved the offer, sale, or purchase of a ‘security,’ itself sometimes disputable.
- 2A material misstatement or omission. You made an untrue statement, or omitted a fact, that was material to a reasonable investor.
- 3Willfully and with intent to defraud. You acted deliberately to deceive, the decisive element; honest mistakes and disclosed risks are not crimes.
- 4In connection with the transaction. The misrepresentation was connected to the investment decision, not collateral or immaterial.
Examples of Conduct Charged as Securities Fraud
- Promising ‘guaranteed’ or unrealistic investment returns
- Running a Ponzi or affinity-fraud scheme
- Selling unregistered investments without a required license
- Misusing or diverting investor funds for personal use
- Omitting material risks or conflicts from investor disclosures
What Sentence Could You Actually Face?
A standalone securities-fraud conviction is a probation-available Class 4 felony, but the stacked fraudulent-schemes and laundering counts, plus restitution to investors and forfeiture, drive the real exposure. Restitution and mitigation remain powerful tools.
Class 4
Securities Fraud
Class 2
With Fraudulent Schemes
Stacked
Laundering / Federal
⚠ Restitution & Loss Drive the Outcome
In investment-fraud cases, courts order full restitution to investors, and the alleged loss drives both the charging decision and the sentence. The State’s loss figure is frequently inflated, ignoring market declines, returns already paid, and recoverable assets. Establishing the true investor loss, with a valuation expert, is both a charging and a sentencing defense.
How We Fight Arizona Securities Fraud Cases
Every case has weak points. These are the defenses we look at first.
Attacking Materiality & Intent
No Intent to Defraud. Securities fraud requires willful, intentional deception. An honest misjudgment, a disclosed risk, or a good-faith belief in the venture is not a crime.
Immateriality. If the alleged misstatement or omission would not have mattered to a reasonable investor, a core element fails.
Adequate Disclosure. Where the risks and conflicts were actually disclosed, often in subscription documents, there is no fraud.
Not a ‘Security’. If the instrument was not legally a security, the securities counts do not apply at all.
Attacking the Evidence & Process
Exemptions to Registration. Many private offerings are exempt; establishing the exemption defeats the 44-1841 and 44-1842 counts.
Inflated Loss. Our valuation experts strip out market losses and returns already paid to establish the true, far lower, investor loss.
Coordinating Parallel Cases. We protect against statements in the ACC, SEC, or civil cases being used to build the criminal case.
Statute of Limitations. Older offerings may fall outside the limitations period and cannot be charged.
The Experts We Bring to the Table
The State builds financial-crime cases with investigators, forensic auditors, and data analysts. We answer with the same caliber of specialists.
Forensic Accountants
Following the Money
Independently trace transactions, audit the State’s spreadsheets, and expose double-counting, missing context, and innocent explanations.
Certified Fraud Examiners
Intent & Scheme Analysis
Evaluate whether the conduct actually fits the charge or is an ordinary business dispute, and where the intent evidence falls short.
Computer Forensics Experts
Devices & Accounts
Examine the digital evidence, emails, logins, and IP data, and challenge whether it really proves who acted.
Financial & Data Analysts
Records & Patterns
Reconstruct the financial record from bank and accounting data and test the assumptions behind the State’s loss calculations.
Tax & Regulatory Experts
Compliance & Reporting
Explain industry practice, reporting rules, and tax treatment that the State has mischaracterized as a crime.
Valuation & Restitution Experts
Loss & Restitution
Establish the true loss amount, often far lower than alleged, which drives both the felony class and any restitution.
Recent Securities Fraud Defense Results
Every case is unique and results depend on the facts, but these examples reflect how our firm handles securities fraud cases across Arizona.
Investment-Scheme Investigation
No Charges Filed
We showed investors received accurate disclosures and the losses were market-driven; the investigation closed with no charges.
Securities-Fraud Allegation
Charges Dismissed
The alleged omission was immaterial and the risks were disclosed; without intent to defraud, the count was dismissed.
ACC Enforcement Matter
Resolved Without Charges
Coordinating the regulatory and criminal fronts, we resolved the Corporation Commission matter civilly with no criminal referral.
Unregistered-Offering Case
Charges Dismissed
We established a valid exemption for the private offering, defeating the registration counts.
Alleged Ponzi Scheme
Charges Reduced
A valuation expert cut the claimed loss dramatically, and we defeated the laundering count, sharply reducing the exposure.
Investor-Fund Diversion
Probation, No Prison
Full restitution and mitigation resolved an investment-fraud case to probation, with no prison.
What Clients Say About Tamou Law
Real Google reviews from clients we have defended across Phoenix and Maricopa County. Every review is from a criminal defense client, never padded with non-legal work.
Clients reach us searching for the best securities fraud lawyer in Phoenix, an investment fraud defense attorney, or help with an Arizona Corporation Commission or SEC investigation. Tamou Law Group defends securities fraud and other white-collar cases across Phoenix, Scottsdale, Mesa, Tempe, Chandler, Gilbert, Glendale, Peoria, and all of Maricopa County. This page is part of our Arizona white collar crimes practice. Call 623-321-4699 for a free, confidential consultation, 24/7.
Arizona Securities Fraud FAQs
Quick answers to the questions we hear most about securities fraud charges, penalties, and defenses in Arizona.
Is securities fraud a felony in Arizona?
Yes. Willful securities fraud committed with intent to defraud is a Class 4 felony under A.R.S. 44-2036. The same conduct is usually also charged as fraudulent schemes (A.R.S. 13-2310), a Class 2 felony, which raises the exposure.
What does the State have to prove for securities fraud?
That, in connection with the offer, sale, or purchase of a security, you made a material misstatement or omission, or engaged in a scheme to defraud, willfully and with intent to defraud. Materiality and intent are the key elements.
Is a failed investment securities fraud?
No. A losing investment, by itself, is not a crime. Securities fraud requires a material misrepresentation made with intent to defraud. Market losses, honest mistakes, and properly disclosed risks are defenses.
Who investigates securities fraud in Arizona?
The Arizona Corporation Commission’s Securities Division, often alongside the SEC, civil investor lawsuits, and county or federal prosecutors. These run in parallel, and statements in one can be used in the others.
What should I do if I get an ACC or SEC subpoena?
Do not produce documents or testify without counsel. Securities cases run on parallel civil, regulatory, and criminal tracks, and what you say to a regulator can build the criminal case. Coordinate your defense first.
What is the difference between securities fraud and fraudulent schemes?
Securities fraud (A.R.S. 44-1991) is specific to securities and is a Class 4 felony. Fraudulent schemes (A.R.S. 13-2310) is the broad fraud statute and a Class 2 felony. Investment-fraud cases are usually charged under both.
What are registration violations?
Selling unregistered securities (A.R.S. 44-1841) or acting as an unregistered dealer or salesman (A.R.S. 44-1842). Many private offerings qualify for exemptions, and establishing an exemption can defeat these counts.
Can securities fraud be charged federally?
Yes. Larger or interstate matters can be charged federally as securities fraud or wire fraud, carrying much higher exposure, in addition to or instead of state charges. We assess both fronts from the start.
Will a conviction end my financial career?
Likely. A securities-fraud conviction brings a lifetime industry bar and regulatory action from FINRA, the SEC, or the ACC, independent of the criminal sentence. Protecting your licensure is a central goal.
How is investor loss calculated?
Prosecutors often inflate the loss by ignoring market declines, returns already paid, and recoverable assets. A valuation expert can establish the true, far lower loss, which affects both charging and sentencing.
Will I get a real attorney or a junior associate?
At many large firms the name on the door is a marketing figurehead and your case goes to a rotating associate. At Tamou Law Group your defense is handled by a full team of experienced attorneys, not associates, including founding attorney Michael Tamou. Call 623-321-4699, 24/7.
Key Takeaways
- Criminal securities fraud (A.R.S. § 44-1991), committed willfully with intent to defraud, is a Class 4 felony under A.R.S. § 44-2036.
- Selling unregistered securities (44-1841) or acting as an unregistered dealer/salesman (44-1842) are separate violations.
- The same conduct is usually also charged as fraudulent schemes (A.R.S. § 13-2310), a Class 2 felony, raising the exposure.
- Cases run on parallel tracks, the ACC, the SEC, civil investors, and prosecutors, and a statement in one can be used in all of them.
- The key elements are materiality (did the statement or omission matter?) and intent to defraud (vs. an honest, failed investment).
- These are expert-heavy cases, won with forensic accountants, valuation experts, and securities specialists.
- Your case is handled by a full team of attorneys, not associates, including Michael Tamou, available 24/7 at 623-321-4699.
Two Arizona Offices, One Team
We serve all of Maricopa County and the surrounding area, with free, confidential consultations 24/7 by phone and in-person meetings at either office by appointment.
Case Results Disclaimer: The results described on this page are based on specific facts and circumstances and do not guarantee or predict a similar outcome in any future case. Every case is different. Past results do not guarantee future results. No attorney-client relationship is formed by viewing this page or submitting a contact form until a written fee agreement has been signed. Tamou Law Group, PLLC is licensed to practice law in the State of Arizona. This website is for informational purposes only and does not constitute legal advice.