MONTGOMERY, Ala. (AP) - The director of the Alabama Securities Commission expects a new state law to make it easier to prosecute securities fraud cases that take years for the crime to emerge.
Gov. Robert Bentley signed legislation Tuesday sponsored by Republican Rep. Paul DeMarco of Homewood that extends the statute of limitations for many crimes from three years to five years. They include theft of property, extortion and bribery.
Securities Commission Director Joe Borg said the new law also extends the statute of limitations for securities fraud and theft by deception to five years from when the fraud is discovered. The statute of limitations for theft by deception had been three years from when the crime occurred and securities fraud had been five years form when the deal occurred.
Borg said that during the recession, when interest rates on bank accounts dropped very law, some people, particularly senior citizens, put their money in long-term investments that didn’t offer a return until five or six years later. By then, the statute of limitations had run out if any fraud was involved.
“This is going to be a big deal for long-term investments,” he said in a phone interview Tuesday night.
The bill received final passage in the Legislature on April 3, the last day of the 2014 session. It did not get a negative vote in either the House or the Senate.
It was one of two major bills the Securities Commission got passed at the end of the session. The other, which has also been signed by the governor, allows the use of “crowd funding” through social media to raise up to $1 million to start a small business.