The Federal Crackdown On Securities And Commodities Fraud
Securities and commodities fraud is a significant federal offense that comes with harsh penalties. Accordingly, federal prosecutors invest substantial time and resources toward investigating allegations of financial crimes to crackdown on these offenses.
As a white collar criminal defense attorney who has been a prosecutor for these types of crimes, I, Peter Katz, offer keen insight and effective defense strategies. When you are my client, you are the most important client I have. At the Law Offices of Peter Katz, I offer a free consultation so that you can understand the charges, your options and how I can help. Call 609-900-2648 to arrange a meeting with me.
The Two Groups That Work Together To Prosecute These Cases
One way that the Department of Justice (DOJ) pools its resources to prosecute these crimes is through partnerships with other government agencies. For example, the DOJ actively works with the Commodity Futures Trading Commission (CFTC) to target individuals and companies for potential violations of federal commodities laws.
Federal prosecutors will use Title 18 U.S.C. Section 1348 to bring charges against those alleged to have engaged in securities and commodities fraud. The law, mirrored after both the mail and wire fraud statutes, makes it a crime for one to defraud someone in connection with a commodity or security or obtain by false or fraudulent pretenses any money or property in connection with a sale or purchase of a commodity or security.
Role Of The Statute In Attempt And Conspiracy
It is important to note that under Title 18 U.S.C. Section 1349, one who attempts or conspires to commit an offense under Title 18 U.S.C. Section 1348 faces the same penalties as they would had they actually violated Section 1348 itself.
What The Prosecutor Must Prove
At trial, the government must prove four elements beyond a reasonable doubt to find one guilty of securities fraud. Those elements are:
- The party involved deceived another in the course of business, such as through false statements.
- The fraudulent act relates to the sale of securities.
- The securities in question are connected to the deception.
- The alleged party knowingly executed the plan.
What Are Commodities And Securities?
A commodity is a tangible item that can be bought or sold on the open market. Examples of commodities include food and oil. A security is any form of financial instrument that can be traded, like stocks and bonds. Given the importance of commodities and securities in the global financial market, the government regulates them heavily.
Examples Of Federal Securities Fraud
There are countless ways one can run into a Title 18 U.S.C. Section 1348 violation, but to get a general sense of crimes covered under the statute, here are a few examples:
- Insider trading: This offense occurs when one trades securities based on material nonpublic information.
- Misrepresentations: One commits this crime when, despite knowing the security’s value, they manipulate said value by deceiving investors with misrepresentations such as that concerning the company’s profitability.
- Churning: Since stockbrokers receive a commission for every trade made on a client’s behalf, the practice of churning occurs when the broker excessively trades to generate commission.
- Accounting fraud: Similar to misrepresentations, to make a company look more profitable and attractive to potential investors, one manipulates the company’s financial records.
Penalties For Securities Fraud Under Title 18 U.S.C. Section 1348
Penalties for securities fraud include both potential imprisonment and significant financial penalties. It is also important to note that one could face civil penalties, like revoking trading privileges and fines from the Securities and Exchange Commission. Conviction under Title 18 U.S.C. Section 1348 comes with a possible 25-year federal prison sentence and fines in the thousands of dollars.
Why Obtaining Effective Legal Counsel Makes A Difference
As a former federal and state prosecutor, I have inside information regarding this type of criminal defense. The earlier you engage with defense counsel during the beginning stages of the investigation, the more leverage you will have in crafting an impenetrable defense and proving your innocence. With your professional reputation on the line, a securities fraud conviction has the potential to ruin your livelihood. Just the possibility of being indicted comes with significant ramifications that could put your life and future in jeopardy.
I Am Ready To Help
I am ready to bring my more than two decades of experience to your case. When I take your case, I will work tirelessly to protect you and your rights. Call the Law Offices of Peter Katz at 609-900-2648 or contact me via my website email form. With these types of charges, it is imperative to begin preparing your defense today. I serve clients in both New York and New Jersey.