SEC Investigations

Sound Defense When Faced with a Financial Investigation

With unprecedented resources, the U.S. Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and other marketplace watchdogs vigorously investigate and pursue actions against bankers, traders, and other financial industry professionals.

These agencies often use every tool at their disposal to seek various sanctions, including restitution, fines, and license suspensions or bars. Investigations can stem from public outcry, an anonymous whistle-blower complaint, a dissatisfied client, or suspicious market activity. Even a seemingly marginal transgression or a false claim can put your company in danger or your career and freedom at risk.

Potential Avenues of Investigation

When these agencies become involved, often they are seeking to uncover evidence of suspected wrongdoing within the financial services industry. Some of the most common forms of securities fraud include market manipulations, accounting fraud, insider trading, improper short-selling and restricted stock sales, market timing, and “pump-and-dump” schemes related to penny stocks.

Further, the government takes securities and stockbroker trading seriously, and FINRA Rule 8210 may compel you to testify or produce documents to support their investigation. This “8210” letter of inquiry may be sent for a variety of reasons, including customer complaints, audits, items in U4 (registration) and U5 (termination of registration) forms, unusual trading activity, and filings for arbitration.

Federal Criminal Defense Lawyers Can Play a Critical Role

Oftentimes, a subpoena will be issued to you, your employees, or your company in general, and it will request the preservation and production of certain documentation. At this point, it is imperative that you contact an experienced defense attorney in order to properly evaluate and interpret the subpoena. Moreover, a defense attorney can step in and act as a buffer between you and law enforcement to assure that neither incriminating statements nor actions take place.

From initial inquiries through in-depth investigations, we can evaluate your situation and limit your potential criminal exposure. This may include how to appropriately respond to subpoenas, testimony preparation, and effective ways to handle settlement negotiations during pre-arrest or pre-trial dialogue.

Your Criminal Defense Begins Now

If you are being investigated by the SEC, FINRA, or any other governmental agency responsible for regulatory compliance, do not hesitate to reach out to a former prosecutor and seasoned criminal defense attorney.

The way in which this process is handled is crucial to your protection, and if defended correctly, can shield you from future criminal exposure. Missteps at an early stage will undoubtedly lead to a criminal prosecution based in part on incriminating information obtained during these investigations; as such, potential federal penalties may be unavoidable if you are not represented by an effective criminal defense attorney.

It is imperative, therefore, that you hire a criminal defense attorney to assure that the investigation is narrowed, and the responses made are appropriate and exculpatory. It is also crucial that your defense attorney, without hesitation, begins a counter-investigation by identifying witnesses, locating corroborative evidence, and issuing subpoenas. Do not be naive or misguided during this process. Just because there may not be a threat of an imminent arrest, an investigation by the SEC or FINRA can be devastating to you and your company.

The sooner you put your matter in the hands of an experienced federal fraud lawyer in Manhattan, Brooklyn, Bronx, Queens, and Staten Island, the more opportunity you will have to work toward a favorable outcome.