Criminal Securities Law Defense

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Experienced Securities Fraud Defense Team

If you are being investigated or have been indicted for criminal securities fraud, it is time to contact a securities fraud defense attorney.

Criminal prosecutions for securities fraud are on the rise for many reasons, namely due to the advances in technology which have led to innovations such as coin offerings and digital assets.

Federal agencies also coordinate their investigations with one another. Therefore, cases that are initially investigated by the Securities and exchange Commission (“SEC”) could be referred to the Department of Justice (“DOJ”) for criminal prosecution.

This puts your business at risk. A criminal prosecution could lead to penalties in the multi-millions, significant jail time, and an irreparable reputation. Do everything possible to protect your business and your liberty.

At The Criminal Defense Firm, our securities fraud defense attorneys are experienced in defending our clients against criminal charges and vigorously fight to get our clients a favorable result.

We are a nationally recognized law firm composed of the most dedicated, eager, and enthusiastic attorneys in the nation. Our team includes former FBI agents, former U.S. attorneys, and former prosecutors ready to defend you.

There is no time to wait with criminal matters. Your liberty and entire livelihood are at stake. The federal government’s job is to scrutinize your business and aggressively prosecute you under the federal securities laws.

Serious charges demand a serious and prompt response. It is time to be proactive in your defense. We can help you.

Call or contact The Criminal Defense Firm as soon as possible to defend your life, liberty, business, and reputation.

Put our highly experienced team on your side

Brian J. Kuester
Brian J. Kuester

Former U.S. Attorney

Former DA

Amanda Marshall
Amanda Marshall

Former U.S. Attorney

Local Counsel

Joe Brown
Joe Brown

Former U.S. Attorney
& Former District Attorney

Local Counsel

John W. Sellers
John W. Sellers

Former Senior Trial Attorney
U.S. Department of Justice

Local Counsel

John W. Sellers
Linda Julin McNamara

Former Chief, DOJ Appeals

Local Counsel

Elizabeth Stepp
Elizabeth Stepp

Litigation Counsel

Aaron L. Wiley
Aaron L. Wiley

Former Federal Prosecutor

Local Counsel

Roger Bach
Roger Bach

Former Special Agent (OIG)

Timothy E. Allen
Timothy E. Allen

Former Senior Special Agent

Chris Quick
Chris Quick

Former Special Agent (FBI & IRS-CI)

David M. Bentz
David M. Bentz

Former U.S. Secret Service Agent

Ray Yuen
Ray Yuen

Former Supervisory Special Agent (FBI)

What is Criminal Securities Fraud?

Criminal securities fraud occurs when an individual or entity makes false statements about the value of a company’s stock or makes decisions about a particular stock based on false information.

The goal of such conduct is to bring substantial profits to the fraudster by causing severe losses to investors. Criminal securities fraud must involve some willful conduct by the actor.

Insider trading is a popular form of criminal securities fraud and occurs when “insiders” such as executives, officers, and board members buy or sell stock based on information that is not yet publicly available. Criminal securities fraud can also involve accounting and reporting fraud by company executives.

Examples of Criminal Securities Fraud

Federal legislation on securities laws prohibits a scheme or article to defraud a person or a scheme or artifice to fraudulently obtain money or property through misrepresentation or deceit. It also prohibits fraud involving corporate accounting records and documents.

Such legislation applies to investors, issuers, corporate executives, investment advisers, broker-dealers, etc. Any individual or entity that is found to have violated a criminal provision of the federal securities laws could face decades of imprisonment and significant fines and penalties in the multi-millions.

Examples of federal statutes that the Justice Department often utilizes to investigate and prosecute defendants include the following:

  • The Securities Act of 1933
  • The Securities Exchange Act of 1934
  • The Sarbanes Oxley Act of 2002 (“SOX”)
  • The Investment Advisers Act of 1940
  • The Investment Company Act of 1940

The following are some of the most common criminal securities law violations:

  • Hedge fund abuses
  • Falsifying and concealing business records
  • Accounting and reporting fraud
  • Falsified financial statements
  • Misappropriate of corporate funds
  • Pump and dump schemes
  • Ponzi and pyramid schemes
  • Insider trading by high-ranking members in corporation
  • Backdating stock options
  • Short selling abuses
  • Mutual fund fraud
  • Microcap fraud
  • Embezzlement
  • Making false statements to the government

If you have any questions regarding a violation on this list or an alternative violation, give our team of securities fraud defense attorneys a call today.

Criminal Provisions under the Federal Securities Laws

The two main provisions that the DOJ utilizes for criminal prosecution of the securities laws include (1) Section 17(a) of the Securities Act of 1933 and (2) Section 10(b) of the Securities Exchange Act of 1934.

The Securities Act of 1933

Section 17(a) prohibits any person in the offer or sale of securities in interstate commerce from employing any device, scheme, or artifice to defraud; obtain money or property by fraud or omission; or engage in a transaction that would be fraud or deceit upon the purchaser.

Willful violations of Section 17(a) can lead to criminal prosecutions and fines of not more than $10,000, five years imprisonment, or both.

The Exchange Act of 1934

Section 10(b) and Rule 10b-5 thereunder is perhaps one of the most common provision that the federal government utilizes for securities fraud cases.

This section makes it unlawful for an individual in interstate commerce in connection with the purchase or sale of any security to employ any manipulative or deceptive device in contravention of SEC rules and regulations.

Prosecutions under this section for insider trading are serious felonies. Insider trading violations under this section can lead to penalties of not more than 20 years imprisonment and fines of $5,000,000 for an individual and $25,000,000 for a corporation.

Criminal Provisions under SOX

In addition to criminal prosecution under the federal securities statutes the Securities Act of 1933 and the Exchange Act of 1934 individuals and entities should also be aware of criminal provisions under the Sarbanes Oxley Act of 2002 (“SOX”).

SOX was enacted in 2002 in response to major corporate scandals in the United States with respect to securities and accounting fraud. Scandals including Enron, Tyco, and WorldCom have costs investors billions of dollars as a result of the drop in share prices.

Investor confidence was shattered, and the federal government reacted by enacting legislation that sought to combat securities and accounting fraud.

In addition, the federal government including criminal investigations by the Justice Department has taken an aggressive approach towards prosecuting defendants for violations of the federal securities laws as well as violations under SOX.

The purpose of SOX is to enhance the penalties for public companies for engaging in accounting and securities fraud; obstruction of justice; and other types of corporate fraud especially with respect to corporate executives and officers.

Depending on the section for which an individual or entity is prosecuted under, violations of SOX could lead to penalties in the multi-millions, or imprisonment terms of 10-20 years, or both.

How Do Criminal Investigations for Securities Law Violations Work?

Most SEC investigations begin with a tip from a whistleblower or inconsistency identified in a public filing. In fact, the SEC relies heavily on the assistance of whistleblowers to alert it to instances of fraudulent conduct that impairs capital markets and harms investors. After the tip or inconsistency is identified, the SEC’s Enforcement Division begins an investigation.

In some circumstances, the SEC will refer cases to the Justice Department where the situations involve criminal violations of the federal securities laws. In other circumstances, the DOJ will investigate and seek indictments on its own.

A pending federal investigation or indictment could lead to the following:

  • Significant fines and penalties in the multi-millions
  • Imprisonment terms
  • Loss of customer base and business contacts
  • Inability to do business with the federal government in the future
  • Reputational harm
  • Permanent injunctions
  • Disgorgement orders
  • Debarment and/or loss of license
  • Miscellaneous charges in connection with litigation such as perjury and obstruction of justice

When your case involves a criminal matter, be sure to understand that you have crucial constitutional rights such your Fifth Amendment privilege against self-incrimination.

These are vital rights in the criminal justice system and rights that an experienced securities fraud defense attorney can fight for and protect on your behalf.

Need Legal Advice Regarding Criminal Securities Fraud?

Being investigated or indicted for criminal securities fraud can be a worrisome time. It has the potential to permanently ruin your reputation and life’s hard work not to mention the fines and penalties in the multi-millions and jail time that are possible.

If you are worried or have questions about an investigation or indictment, do not wait another minute to contact one of our Senior Criminal Securities Fraud Defense Attorneys.

In the meantime, always remember to protect yourself, your company, and your rights. Do not speak with any federal agent without first consulting with your attorney. Never divulge any information and never hand over any documents. Retain an attorney first. Put a defense attorney on your aside right away.

At The Criminal Defense Firm, our attorneys are experienced in defending clients against allegations of criminal securities fraud. We have an excellent success record of favorable verdicts, settlements, and negotiations.

Call or contact us today for a free consultation to discuss your case so we can start defending your reputation, liberty, and livelihood!

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