Since the financial crisis started several years ago, there has been intense scrutiny place on those thought be guilty of committing white collar crimes in Sacramento and across the country. The Securities and Exchange Commission invests a significant amount of resources into investigating suspected individuals and trying to secure their conviction.
Recently, the founder of a West Coast investment research firm was charged with securities fraud for insider trading in federal court. According to federal authorities, the man provided investment tips to hedge fund managers that were his clients. Apparently, the man "befriended" the employees of various publicly traded companies to gather information pertinent to stock prices. When he came before a federal grand jury, he pled not guilty to charges that could cost him 10 years in prison if he is convicted.
According to the man's legal representatives, there is a multitude of phone calls and financial documents to sift through throughout the discovery process. Knowing this, the defense has a lot of work to do in order to build the best case they possibly can. In cases that involve a massive federal investigation, such as this one, the research and discovery phase is critical for a person's defense. During this time, experienced defense attorneys can uncover information that may weaken the prosecution's case.
This case also raises an important point about when a person can employ the services of an attorney. The man charged in this case knew that federal investigators were interested in him when they asked him to wear a device to record private meetings with his clients. Whenever someone knows they are the subject of a federal investigation for fraud, or other crimes, they can hire an attorney. It is not necessary to wait until formal charges are filed to hire an attorney. In fact, having legal counsel during the course of an investigation can help you better understand your legal rights at any stage during an investigation or trial.
Source: Bloomberg Businessweek, "Analyst Kinnucan Pleads Not Guilty to Insider Trading," Patricia Hurtado, March 14, 2012