Federal Insider Trading Defense Attorney


Do you need a federal insider trading defense attorney? Scrofano Law PC can offer you the representation you need. Book an appointment with us today.

The Role of a Federal Insider Trading Defense Lawyer


Insider trading occurs when individuals use non-public information about a company to trade in its shares for personal gain. Those who have access to confidential information are prohibited from trading the company’s stocks. Insider trading is against federal law because it allows individuals to unfairly profit from their access to confidential information.

Insider trading charges should be taken seriously. The allegation alone can have significant ramifications. Further, a conviction of insider trading can lead to severe penalties such as hefty fines as well as imprisonment. A conviction can also have a lasting impact on your career and reputation.

Dealing with insider trading allegations can be frightening. However, it’s important to know that there are still defenses available to you. The consequences of insider trading violations can be harsh. That’s why hiring a skilled insider trading attorney like those at Scrofano Law PC may be best. They can provide useful advice and craft a robust defense strategy.

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.

Who Investigates Insider Trading?


People are often familiar with highly-publicized insider trading cases. However, a lot of cases investigated for insider trading don’t make national headlines. Federal agencies that investigate these cases include:

  1. The U.S. Department of Justice (DOJ)
  2. Federal Bureau of Investigation (FBI)
  3. Securities and Exchange Commission (SEC)

The Securities Exchange Act of 1934 created the Securities and Exchange Commission (SEC). The SEC is responsible for regulating the U.S. financial market. Among other things, they enforce the securities laws prohibiting insider trading.

The SEC is considered the primary regulatory body for insider trading cases. The SEC has extensive resources to investigate insider trading cases. They can also subpoena documents of individuals believed to have non-public information.

The SEC typically works closely with the DOJ, which prosecutes federal crimes. In fact, those facing insider trading charges may face parallel cases filed by both the DOJ and the SEC.

If you are contacted by the SEC or DOJ, it is essential to seek the advice of a federal insider trading lawyer.

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.

Still Have Questions? Reach Out to Scrofano Law Today!


Those investigated for insider trading may face negative consequences. Defendants can lose their job or suffer damages to their reputations. So, it is essential to handle insider trading cases discreetly. Insider trading lawyers at Scrofano Law can offer the representation you need.

If you are accused of insider trading, you need to take the allegations seriously. Hiring an experienced federal insider trading lawyer can be beneficial to the outcome of your case. Attacks on the prosecution’s case are possible; we may have defenses available to you.

Do not take risks. Invest in quality legal representation to ensure your rights are protected. Reach out to DC criminal lawyer at Scrofano Law today.


We Fight for Your Rights!