A recently published book shed light on stock trading practices that many are saying amount to securities fraud. According to the book, titled "Flash Boys: A Wall Street Revolt," the stock market has been transformed by high-speed trading which often gives brokers an advantage over the general public. Now, a class action lawsuit has been filed against many stock exchanges and brokerage firms, claiming they exchanged non-public, material trading data for kickbacks. The lawsuit alleges these alternative trading arenas, known as "dark pools," have manipulated the market, bilking investors out of billions of dollars.
The securities market must follow a strict set of rules in order to provide fairness and equal opportunity to all investors. When a trader or investor receives inside information and uses that information to make a trade with the intent of receiving a financial benefit, then that individual may have broken the law.
In some of these instances, an individual can face criminal penalties, but many times money is lost and investors are left financially harmed. An investor may lose money being saved for a child's education, a new home or retirement. Wealth that took years, even decades to build can disappear overnight. When this happens as a result of another individual's wrong doing, then civil action can be taken in an attempt to recover losses.
A securities fraud lawsuit often involves several victims, making it ripe for class action status. Bringing these lawsuits, however, can be quite complex and may require the help of an attorney. In Texas, a local attorney can fight to help those who lost money investing recover their losses and punish those who play fast and loose with other people's money.