On behalf of Girard Bengali, APC posted in securities arbitration and litigation on Friday, April 26, 2019.
Many financial professionals in the Los Angeles area, basically all of those who trade in regulated stocks, bonds and other securities, may find themselves under investigation by the United States Securities and Exchange Commission, or SEC.
The SEC is responsible for regulating the nation’s public financial markets to assure that they are fair and transparent. This fairness and transparency in turn encourages investment and economic growth.
On the flip side, though, financial professionals subject to the SEC’s jurisdiction have a lot of detailed rules and regulations that they must follow. If they run afoul of these rules, they may become the target of the SEC’s enforcement activity.
Some of these rules may seem easy enough to follow. For instance, most honest people know intuitively that they should not lie or steal in the course of their work. However, in other cases, professionals can make genuine mistakes. A careless tip to a client, for example, can lead to an allegation of insider trading.
In the most extreme cases, the SEC assists the Department of Justice or other law enforcement agencies with pursuing criminal charges.
More likely, though, a professional who gets cross-wise with the SEC will face either a civil action in court or an administrative action. The end result of either one of these steps can be very unpleasant. A professional may face a court injunction, monetary penalties, accountings, the loss of one’s license to work with regulated securities and other sanctions.
A financial professional who is facing any type of enforcement action from the SEC has a lot at stake, including his professional reputation and, in some cases, even their ability to keep working in his career field. A financial professional in this situation would want to consider getting the help of an attorney with experience handling securities arbitration and litigation as well as administrative actions.