In a post a few days ago, we talked with our readers about insider trading. Considered an illegal activity, we wanted residents here in Melbourne, as well as across the state, to be aware of what activity might lead to accusations of insider trading. Today though, we'd like to expand on the topic and talk about the legal challenges an individual here in Florida could face if they are accused of insider trading.
As we explained in the first part of this post, accusations of insider trading can lead to both criminal litigation and civil litigation. Litigation is often prefaced by an investigation conducted by the U.S. Securities and Exchange Commission, or SEC, where investigators will look at things like complaints and/or trading data -- among other things -- in order to determine whether a violation of securities law has occurred. Depending on the evidence collected, litigation may be the next step.
It's important to note that the SEC may bring both criminal and civil proceedings against an individual who is accused of insider trading. There is a lot at stake too if this happens. Criminal penalties include steep fines and the possibility of several years in prison. Civil penalties are just as steep, forcing the accused to give up their gained profits and risk an injunction against further securities activity.
As is the case in other areas of the law, handling business litigation or any other form of litigation can be challenging if you don't have the right background knowledge. The lawyers here at Frese Hansen have the experience you need in order to make informed decisions about your case. They will also work diligently to make sure that the litigation you do face is just and within the scope of the law as well.
Sources: U.S. Securities and Exchange Commission, "How Investigations Work," Accessed May 28, 2015
U.S. Securities and Exchange Commission, "TherapeuticsMD, Inc., 2013 Insider Trading Policy," Accessed May 28, 2015