When you hear news stories about corporate malfeasance, you usually hear only the most egregious criminal activity. Ponzi schemes, IPO fraud, and massive misrepresentations on a grand scale are commonly reported.
While these activities can certainly leave you with serious financial harm, perhaps even financial ruin, the truth of the matter is that financial misconduct in the corporate setting is far more common than many people realize. One recent report clearly highlights that fact.
Study shows the pervasiveness of corporate malfeasance
A professor at Harvard’s business school was able to access confidential records from numerous financial firms. These records show that corporate misconduct occurs about two times per week at each financial firm. This equates to 121 instances of misconduct over the course of the year at every corporation.
This number is staggering considering that public investigations of these firms give the impression that illegal financial action only occurs once every 1,586 days per firm. This underreporting can discourage individuals who have lost significant sums due to misconduct.
What this report means for you
This report should be eye-opening. Investors who have lost a lot of money should no longer assume that they just lost out on a risky investment. Instead, they should be proactive in determining what, exactly, caused their losses. After all, there’s a significant likelihood that their losses are attributable to some sort of corporate malfeasance.
Building your case
In order to recover compensation for your losses, you’re going to need strong evidence to support your position. This means obtaining the firm’s financial records and talking to witnesses who might be able to give you a realistic perspective on what was occurring at the firm at the time you suffered your losses.
You can depose individuals at the firm to determine what information they know, which can give you leads to follow as you investigate your case and build your claim.
But where do you start?
There’s no cookie-cutter approach to your case. You need to start where you can find information that leads you to the truth.
You might want to scrutinize your investment records and ask questions of the firm that lost your money. Ensure that you track and keep all communications, as they could serve as powerful evidence later down the road.
Additionally, think about reaching out to the SEC to see if they have any open investigations or if they’re interested in following up on your complaint. You can also try to find others who have lost money at the firm to see if their circumstances are similar. You might be surprised to find that the suspected wrongdoing is far more wide-reaching than you expected.
Don’t let the intricacies of your case deter you
Financial fraud cases involving Ponzi schemes, misrepresentations and other forms of fraud can be enormously complicated. Making matters even more challenging is the fact that much of this wrongdoing is swept under the rug without coming to the public’s attention. Although you might feel like the deck is stacked against you in this regard, don’t let the complexities of your situation deter you from acting.