Insider Trading Law Hope Lefeber Philadelphia Criminal Defense Attorney
Insider Trading Criminal defense lawyer Hope C. Lefeber is a tireless advocate for her clients' constitutional rights and devoted to respect for due process of law. She can readily identify if evidence has been unlawfully obtained and build a strong defense on your behalf.
"Insider trading" is a term that most investors have heard and usually associate with illegal conduct. But the term actually includes both legal and illegal conduct. The legal version is when corporate insiders—officers, directors, and employees—buy and sell stock in their own companies. When corporate insiders trade in their own securities, they must report their trades to the SEC.
Attorney Lefeber is an experienced federal criminal defense attorney with in-depth knowledge of federal law and procedure. If your rights have been violated in any way by law enforcement officials, she will employ forceful advocacy designed to obtain results.
Rule 10b5-1 provides that a person trades on the basis of material nonpublic information if a trader is "aware" of the material nonpublic information when making the purchase or sale. The rule also sets forth several affirmative defenses or exceptions to liability. The rule permits persons to trade in certain specified circumstances where it is clear that the information they are aware of is not a factor in the decision to trade, such as pursuant to a pre-existing plan, contract, or instruction that was made in good faith.
Rule 10b5-2 clarifies how the misappropriation theory applies to certain non-business relationships. This rule provides that a person receiving confidential information under circumstances specified in the rule would owe a duty of trust or confidence and thus could be liable under the misappropriation theory.
High Frequentcy Trading
A former Goldman Sachs Group Inc. computer programmer was convicted of stealing the confidential source code of the investment bank's high-speed trading system. Goldman required employees to sign a confidentiality agreement as part of their employment and that any software created by them in their jobs were the property of the investment bank.
Sergey Aleynikov's conviction is the second guilty verdict in as many months involving the theft of high-speed trading code. Last month, Samarth Agrawal, a former Société Générale trader, was convicted of stealing the bank's high-frequency trading code after he freely admitted to sharing aspects of the bank's computer code with a rival. High-speed trading and other financial firms aggressively protect their code, considering it a trade secret and a competitive advantage. In its second day of deliberations, the jury found Mr. Aleynikov guilty of theft of trade secrets and transportation of stolen property. He faces as much as 10 years in prison on the trade secrets charge.
The trial of Mr. Aleynikov focused on the complex computer programs used by investment banks, hedge funds and other securities firms to squeeze more profits from their trading operations. Such high-frequency trading involves rapid-fire buy and sell orders aimed at capitalizing on miniscule differences in price.
Goldman Sachs: computerized front running, using high-frequency trading programs. Wall Street commentator Max Keiser who invented and patented the program calls it rigged market capitalism: all markets today are subject to manipulation for private gain. High Frequency Trading (HFT) or black box trading, automated program trading uses high-speed computers governed by complex algorithms (instructions to the computer) to analyze data and transact orders in massive quantities at very high speeds.
Federal prosecutors in Manhattan had alleged that Mr. Aleynikov secretly copied Goldman Sachs's confidential source code for its high-frequency trading platform in his last days at the investment bank and uploaded it to a server in Germany. Prosecutors had alleged that Mr. Aleynikov, 40 years old, intended to use it to build a similar trading platform at his new employer, Teza Technologies LLC.
