PIABA ANNOUNCES THE FILING OF AN AMICUS BRIEF IN SUPPORT OF GREAT INVESTOR PROTECTION
September 27, 2002. Beverly Hills, California. The Public Investors Arbitration Bar Association (PIABA), a nationwide bar organization of attorneys dedicated to the representation of individual investors in disputes with the securities industry, today announces the filing of its “friend of the court” brief in support of the Security and Exchange Commission’s petition to review a federal appellate decision that narrows the definition of a security.
A recent Eleventh Circuit Court of Appeals decision in Securities and Exchange Comm’n v. ETS Payphones, Inc., a panel decided that fixed rate investment contracts are not securities under federal law. As a result, investors who purchased these contracts were not protected by the securities laws. The Securities and Exchange Commission has asked the full panel of the Eleventh Circuit to review the decision.
“By holding that investment contracts are not securities if they offer a fixed rate of return, the court has provided investment promoters with a blue print for fraud,” said Phillip M. Aidikoff, President of PIABA. “Under the Eleventh Circuit’s decision, the seller of a fixed rate investment contract isn’t required to be trained, supervised or even licensed.”
Citing case law decisions from federal and state courts across the country, including the U.S. Supreme Court, PIABA argues that the court’s decision conflicts with existing law.
According to Mr. Aidikoff, “Safety conscious, elderly investors are among those most likely to be defrauded in a fixed-rate scam. The court’s decision strips these vulnerable investors of their rights and should be overturned.”
If you have questions concerning this notice, please contact: Philip M. Aidikoff, Esq. President, Public Investors Arbitration Bar Association www.piaba.org (888) 621-7484