Securities Fraud

Securities Fraud

In this climate, prosecutors are setting their sights on businesses and business people. The Securities and Exchange Commission is working closely with prosecutors in the United States Attorneys’ Offices to see who they can bring charges against. If you are being investigated or charged by the federal government, it is essential that you see an experienced federal criminal defense lawyer immediately.

The federal criminal justice system is significantly more complicated to navigate than the state court system, and penalties can be much higher. Sentences are based upon the total amount of the fraud. The determination of what is fraud requires an attorney who is experienced in the federal courts. When you face federal allegations of financial fraud or securities fraud, it is essential to have an aggressive federal criminal attorney representing you.

The Securities and Exchange Commission and the federal prosecutors are devoting substantial enforcement resources to investigating and prosecuting  insider trading, ponzi schemes and  stock manipulations, commonly known as “pump-and-dump” schemes. If you are being investigated or charged by the federal government, it is essential that you see an experienced federal criminal defense lawyer immediately.

As a former Enforcement Attorney for the United States Securities & Exchange Commission, Philadelphia defense attorney Hope Lefeber’s experience enables her to understand how the government operates, and therefore, enables her to best prepare a winning defense. For over 30 years, Ms. Lefeber has represented individuals charged with various kinds of financial and securities frauds as well as mail and wire frauds.

What Constitutes a Securities Crime?

In the securities field, an individual who engages in conduct proscribed by the securities laws may be convicted if the conduct was "willful." "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 be certain that they have complied with all of the legal requirements. Similarly, Rule 10b5 requires the disclosure of certain material information in connection with securities transactions. The failure to disclose material information and/or the failure to comply with the securities laws may result in serious criminal liability.

A pump and dump scheme involves the promotion of a company’s stock, usually a microcap or penny stock, through false and misleading statements to the investing public. Typically, the promoters of the stock utilize social media, including Facebook, as well as press releases, stock bulletin boards and chat rooms to “pump” the stock. As part of the pitch, the promoters will claim to have inside information about imminent corporate news. In truth, however, the pitch is usually designed solely to generate trading volume to move the stock price up. Once the stock has significantly risen in value, the insiders, typically through nominees, will “dump” or sell their shares into the market, thereby killing the share price. At the end of a successful pump and dump scheme, the insiders will reap substantial profits by selling their millions of shares at an artificially high price, and will leave unwitting retail investors holding worthless shares.

While pump and dump schemes are prevalent and certainly justify the SEC’s attention, not all spikes in a stock’s price and subsequent fall can fairly be labeled a stock manipulation. Similarly, not all stock promotions are fraudulent. If you are under investigation for stock manipulation, it is critical that you are represented by a SEC defense lawyer who is experienced in defending alleged stock manipulations and pump and dump schemes, and who will zealously defend your rights in the SEC investigatory process.

Contact Philadelphia Criminal Defense Attorney Hope Lefeber

If you are facing federal fraud charges, having a lawyer who is highly skilled in federal securities law can be critical to your defense. To get representation from a highly skilled defense attorney, contact the Philadelphia law office of Hope Lefeber by calling 610-668-7927 or completing our online form. Consultations are free and confidential.