Federal Insider Trading Defense Attorney

What Is Insider Trading?

 

While there isn’t a specific definition, certain acts are widely recognized as insider trading. These acts include:

• A breach of fiduciary duty

• Violating the trust of an individual in connection with a sale or purchase of a security

• The use of non-public material or information for the sale or purchase of a security

• Knowing or reckless use of non-public information or material when trading

• Making a personal benefit from an unlawful trade

Suppose someone receives investment information that is unavailable to the public. If they act upon it and buy or sell based on that information, insider trading occurs. Basically, insider information can be used to benefit individuals directly or to help others gain profit by tipping them off.

Oftentimes, white-collar crimes are prosecuted in federal court. This is particularly true when the federal government is a “victim.” These offenses can also be difficult to defend.

You may need all the help you can get if you have found yourself in the middle of an insider trading case. Our white-collar lawyers in D.C. can help you navigate the confusing legal procedures. They can explore your legal options and make sure your rights are protected.

 

Federal Insider Trading Penalties

Federal criminal penalties for insider trading can be severe. Although they depend on the circumstances of the crime, they can include up to $5 million in fines. Individuals convicted can also spend up to 20 years in federal prison. Businesses can also be liable and face fines of up to $25 million.

Individuals accused of insider trading are often charged with similar connected crimes. For example, they may face federal fraud charges such as wire, mail, and bank fraud.

How Can an Attorney Help with Insider Trading Investigation?

 

An experienced insider trading defense attorney can explain the charges you are facing. It’s important to understand why you are being charged and what the consequences can be.

For example, most people don’t realize that the definition of an “insider” is broad. Corporate insiders for insider trading purposes can be corporate officers and directors. But they can also include:

• Lower-level employees
• Family members
• Friends
• Neighbors
• Other outsiders with access to non-public information

Let’s say the CEO unintentionally revealed confidential information to their neighbor. If the neighbor trades on this information, it can be considered insider trading. If that occurs before the information is released to the public, it becomes illegal insider trading. If they do it after, the unfair advantage is negated; thus, insider trading is legal.

An experienced insider trading lawyer can craft the best defense possible. One common defense is not to know non-public information. Federal prosecutors will have to prove the case beyond a reasonable doubt. In other words, they will have to prove that you had access to confidential information.

Another option is proving that you did not act with intent to commit insider trading. Your attorney can also argue that you didn’t execute the trades personally.

Receiving a phone call or visit from an SEC attorney can be the first indication of an insider trading investigation. Declining to answer questions without your own attorney present can be the best move. Your insider trading lawyer can ensure that the prosecution doesn’t obtain evidence illegally. They can also make sure federal authorities don’t violate your rights.