Memphis Injury Lawyer Blog

There has been no shortage of legal gossip around the Memphis trial lawyer water cooler this week. Federal securities law is only slightly harder to figure out than the Internal Revenue Code if it is written upside down in arabic. The national news has been filled of late with the alleged looting of money from innocent investors who placed their savings with the likes of Bernie Madoff. Tennessee charities, retirement funds and individuals have lost enormous sums to this incredible Ponzi scheme. Now we have an alleged swindle that is far closer to home, Stanford Financial. I have yet to see any proof that this investigation (Yes, folks it is ONLY an investigation at this point.) is a bona fide pyramid fraud.

It is important to remember that no one has been proven to be negligent or reckless or even a little bit less than careful. One can only wonder if this media frenzy will pan out to be just that, i.e. the SEC trying to flex its governmental muscles that were so underused during the Madoff heydays. The 1933 and 1934 securities laws prohibit false or misleading statements or the omission of material facts, either of which induce a person to invest their money. A whole raft of regulations in this area of the law (and others) weave a web of control and oversight of this industry. Tennessee law provides for parallel regulation and enforcement similar to the federal laws. With this in mind one must ask: "How the #@%#$@#$@ (heck) do schemes like the Madoff fraud happen?"

Perhaps Charles Ponzi (actually Carlos) , after whom this scam was named, could tell us. For me, an accusation is merely that. An indictment is only an accusation and the filing of a lawsuit against these individuals and companies is only a "claim for relief". Certainly, not a certainty. Either way, this newsy issue must await judgment in the court of public sentiment unless and until this civil action is tried to a conclusion before a court of competent jurisdiction.