Federal Criminal Defense Lawyer Mick Mickelsen From Dallas Broden & Mickelsen - Explains Insider trading
Insider trading happens when someone in a company with private, non-public information about the company uses that information to their advantage to make an illegal sale or trade of securities.
Dallas Federal Criminal Defense Lawyer Mick Mickelsen Explains - Insider Trading
Insider trading is a type of white-collar crime that can result in significant fines and even time in prison. In fact, some of the most notorious insider trading cases have involved high profile defendants who spent months and even years in prison for engaging in this type of securities fraud.” Mick Mickelsen Dallas Federal Criminal Defense Lawyer.
So, what is insider trading? In short, insider trading happens when someone in a company with private, non-public information about the company uses that information to their advantage to make an illegal sale or trade of securities. They can also run afoul of the law if they “tip off” an outsider by sharing their inside information to the outsider’s benefit.
Insider trading isn’t always illegal. Specifically, people with inside knowledge of a company’s financial status are permitted to buy and sell securities. However, they must register these purchases and sales with the Securities and Exchange Commission (SEC).
Insider Trading Can Involve Insiders and Outsiders
While most of the high-profile insider trading cases that make the news involve corporate executives, just about anyone can get caught up in an insider trading case.
For example, if the president of a corporation learns that his company will soon be purchasing a different company and he chats with his doctor about the upcoming acquisition, the doctor may run out and purchase stocks in the company that’s about to be acquired. It’s possible for this to qualify as a case of insider trading.
There have been plenty of cases in which the friends and relatives of a corporate executive faced prosecution for acting on “tips” offered by a corporate insider.
Tough Penalties for Insider Trading
Insider trading is a type of white-collar crime, which means it’s a financial crime involving fraud rather than violence. As a result, people sometimes assume that an insider trading conviction won’t result in prison time.
Such assumptions are misleading. Prosecutors take insider trading very seriously. Under federal law, someone convicted of insider trading can be sentenced to up to 20 years in prison or pay a fine of up to $5 million per insider trading violation. Additionally, they may be forced to turn over any of the profits or illegal gains obtained by way of the insider trading.
Most Notorious Insider Trading Cases
There have been plenty of insider trading cases in the news, both in recent years and throughout history. A handful of cases top the list as the most notorious.
- Albert H. Wiggin and the 1929 Stock Market Crash – After the stock market crash of 1929, bank executive Albert H. Wiggin was found to have shorted 40,000 shares of his own bank’s stock. Investigators discovered that he hid his trades by using corporations owned by his family.
The interesting fact about Wiggin’s case is that his actions weren’t illegal at the time. In fact, other bank executives made similar moves, which led to the stock market crash and the Great Depression. When knowledge of Wiggin’s actions became public, federal lawmakers created specific legislation to criminalize these types of trades.
- Martha Stewart – Martha Stewart had built an empire of homemaking and craft expertise when she was charged with insider trading in the early 2000s. The case revolved around stock she owned in a company called ImClone. The company had developed a new drug that the FDA decided not to approve.
While most people who held stock in the company were hurt financially, other investors, including Stewart, were not. In fact, Stewart had traded 4,000 ImClone shares while they were still priced high. It later emerged that Stewart had received insider information about the FDA’s decision not to approve the drug. In 2004, Stewart was fined $30,000 and sentenced to five months in prison.
- Enron and Jeffrey Skilling – Enron is a name that has become synonymous with corporate fraud. In 2006, Enron president Jeffrey Skilling was convicted of 19 counts of white-collar crime, which include charges for insider trading. He received a 24-year prison sentence and was required to pay $45 million in fines. Skilling was released from prison in 2019 after serving 12 years of his sentence.
- Raj Rajaratnam – Raj Rajaratnum’s case is notable because he received the longest prison sentence for insider trading in U.S. history. At the time charges were brought against him, Rajaratnam was the founder of the Galleon Group, one of the world’s largest hedge fund management companies.
Rajaratnam was convicted of all 14 securities fraud and conspiracy counts brought against him, resulting in a record 11 years in prison. He was also required to pay over $150 million in fines. He was released from prison two years early in 2019.
The above cases are just a few examples of how seriously federal prosecutors take illegal insider trading. Individuals convicted of insider trading can face years in prison, along with steep fines. If you’ve been charged with insider trading, it’s important to discuss your case with a federal criminal defense lawyer who has experience handling white collar crimes cases.
About Broden & Mickelsen Dallas Criminal Defence Lawyers
Experienced criminal defense lawyers in Dallas, Broden & Mickelsen is dedicated to providing aggressive and ethical representation to individuals and businesses charged with criminal offenses. We do this through our unique team approach to the practice of criminal defense in which both partners play an active role in the firm’s cases.
Both partners are committed to the belief that when a person is charged with a crime, he or she deserves to be represented by attorneys that provide a vigorous defense. We do this by evaluating each case individually and by using all the resources available to achieve a favorable resolution. Criminal defense attorneys Clint Broden and Mick Mickelsen are certified for trials and appeals by the Texas Board of Legal Specialization as experts in criminal law.
Defense Lawyers Broden & Mickelsen
2600 State St Dallas
###KISSPR.COM PRESS RELEASE NEWS DISCLAIMER ###
This news has been published for Dallas Criminal Defence Attorneys Broden & Mickelsen. Kiss PR Brand Story Press Release News Desk was not involved in the creation of this content. KISS PR and its distribution partners are not directly or indirectly responsible for any claims made in the above statements. Contact the vendor of the product directly.
The above review statements are those of the sponsor (Source of content) and do not necessarily reflect the official policy, position or views of the content publisher. The content distribution company is therefore not responsible for the content and its authenticity and legal standing of the above subject matter. Each individual is required to exercise its content when making a purchase from the above offer. The information does not constitute advice or an offer to buy. Any purchase made from the above press release is made at your own risk. Editorial merit of this content is subject to news publisher and its downstream partners. Consult an expert advisor/health and professional advisor before any such purchase. Any purchase made from this link is subject to the final terms and conditions of the website's selling as mentioned in the above as source. The content publisher and its downstream distribution partners do not take any responsibility directly or indirectly. If you have any complaints or copyright issues related to this article, kindly contact the company this news is about.
DISCLAIMER of Liability. IN NO EVENT SHALL OUR PR COMPANY BE LIABLE OR RESPONSIBLE TO YOU OR ANY OTHER PERSON FOR ANY DIRECT, INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR EXEMPLARY DAMAGES OF ANY KIND, INCLUDING WITHOUT LIMITATION, LOST PROFITS OR LOST OPPORTUNITIES, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES IN ADVANCE AND REGARDLESS OF THE CAUSE OF ACTION UPON WHICH ANY SUCH CLAIM IS BASED, INCLUDING, WITHOUT LIMITATION, ANY CLAIM ARISING OUT OF OR IN CONNECTION WITH ANY OF THE CONTENT, INCLUDING, WITHOUT LIMITATION, AUDIO, PHOTOGRAPHS, AND VIDEOS, OR OF THE ACCURACY, RELIABILITY, OR LEGALITY OF ANY STATEMENT MADE IN OR OMITTED FROM ANY advertisement, sponsorship, endorsement, testimonial, opinion, or other product-related or service-related statement or review appearing in the Websites or in ANY post or article distributed via the Websites.