Criminal Liability Under 1933 Act - Explained
Criminal Provisions of the Securities Laws
Written by J. Mance Gordon
Updated at April 20th, 2024
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What is the potential criminal liability for violations of 33 Act?
Section 24 of the 33 Act allows the Department of Justice (DOJ) to bring a criminal action against anyone who knowingly and willfully violates the 33 Act. This normally only arises in situations where an issuer commits fraud in the sale of securities. The SEC cannot bring a criminal action itself, but it regularly works in hand with the DOJ to substantiate claims of securities fraud.
Note: Conviction under this provision allows for up to a $10,000 fine and up to 5 years in prison.
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