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NYC Insider Trading Lawyers

Insider Trading: Understanding the Rules and Consequences

To protect the integrity of the financial markets, no one is allowed to use insider information to buy a stock, sell a stock, or otherwise make a decision that may unfairly manipulate its price. Insider trading occurs when an individual receives information that the public may not have access to. It may also occur when an individual receives access to information before it is released to the general public.

Example of Insider Trading

Let’s say that a company is about to release its first quarter earnings at 1 p.m. An earnings report can create volatility in the stock as well as the market as a whole if it is a significant miss or is otherwise not what the market is expecting.

At 11 a.m., you receive word from someone with access to earnings report data that the stock is going to exceed expectations, which should cause the stock to surge. Acting on this information, you buy 100 shares just before 1 p.m.

There are two possible outcomes to this scenario. First, you will make a profit when the stock goes up in value after the earnings report comes out better than expected. Second, you could make a profit as the market sees that someone is buying shares, which will naturally push its price higher regardless of the news.

George FernandezGeorge Fernandez
14:16 30 Apr 24
Excellent 10 out of 10, Helped resolve my case. Jeremy explained everything and made everything easy to understand.
21:33 24 Apr 24
If you are looking for a lawyer that listens, is aggressive where needed, and holds his word above all else, Todd is the best pick. I had hired multiple attorneys prior to hiring the Spodek Group for a white collar case. The first thing that stood out to me was the cost, as anyone going through the process and dealing with the system, money was tight at that time - especially after hiring and firing multiple lawyers. The cost was not as high as others which was definitely a plus. Todd's intake process was also unlike other attorneys. He took the time to actually listen. He cared. He was trying to put himself in my shoes while I was explaining the situation to him and he really took the time to understand the whole situation. Other lawyers will give you 15 mins and send you a retainer agreement. Not Todd, I think he spent almost two hours with me as I was explaining everything.Not only was he great during the onboarding process, he was supportive and very informative through the entire plea process and eventually sentencing. After hiring him, I asked if I should hire a prison consultant, he told me to save my money as he would do everything they would. He was right and held up to his word. Later on I would hear from others that went with the prison consultants that they were a waste of money - I am glad I listened to Todd!When it came time for sentencing, two days prior to sentencing, the prosecutor tried increasing my proposed prison time by almost double - apparently a normal move. Todd and his team worked with me non-stop through the weekend prior to sentencing to ensure that I was not given additional prison time. Again, he took the time to listen and came up with a strategy to explain the case with great detail.Unfortunately, I did plead guilty as that was my best option. Todd and his whole team wrote up nearly 300 pages of a summary of what happened and why I should not be given prison time. If I breakdown the amount I spent with Todd versus the amount of work that I saw being done, I am shocked I was not charged four times as much. The other benefit was, a lot of criminal defense lawyers were just a single attorney with a paralegal or two. Todd had a team of people that I dealt with (5-7 people that I interacted with), but he was ALWAYS accessible. It would never take him more than an hour to reply unless he was in court.I was sentenced to prison and I was emotionally distraught. Todd and his team did whatever they could even after sentencing to make sure I was alright. He personally stayed in touch with my family to ensure I was doing alright and offered support to them. Most lawyers would consider the job complete at sentencing, not Todd.After prison, Todd still spent time with me to make sure I was on the right track and avoiding any potential risks in the future. He has also been giving advice on how to navigate probation etc and has not been looking at the clock for billing.Although I wish I had never been arrested in the first place, I am glad I had Todd and his team in my corner. Without them I likely would have had to spend a lot more time in prison than I did.Thank you, Todd, and the entire Spodek Law team, for helping turn what was a nightmare into a manageable situation!
Yelva Saint-PreuxYelva Saint-Preux
19:26 19 Apr 24
I am immensely grateful to the entire team at Spodek Law Group for their unwavering dedication and exceptional expertise throughout my case. From our initial consultation to the final resolution, their professionalism and tireless advocacy made all the difference. Their strategic approach and attention to detail instilled confidence in me every step of the way.Thanks to their hard work and commitment, we achieved a truly favorable outcome that exceeded my expectations. Not only did they navigate the complexities of my case with precision, but they also provided invaluable support and guidance during what was undoubtedly a challenging time. I cannot recommend Spodek Law Group highly enough, especially attorneys Todd Spodek and Claire Banks; they are beacons of excellence in the legal profession.YSP.
Katherine SunKatherine Sun
18:08 18 Apr 24
my lawyer is Alex Zhik. Efficient, patient and professional
Nun yaNun ya
17:48 18 Apr 24
Todd, Ralph and Alex are amazing. Helped my husband get from a double digit number with multiple charges to a single digit, by the time I blink he will be out. They very professional and help with all your needs. They dealt with my anxiety and worry very well and they understand that your family member needs to get home as soon as possible.
Keisha ParrisKeisha Parris
20:45 15 Mar 24
Believe every single review here about Alex Z!! From our initial consultation, it was evident that Alex possessed a profound understanding of criminal law and a fierce dedication to his clients rights. Throughout the entirety of my case, Alex exhibited unparalleled professionalism and unwavering commitment. What sets Alex apart is not only his legal expertise but also his genuine compassion for his clients. He took the time to thoroughly explain my case, alleviating any concerns I had along the way. His exact words were “I’m not worried about it”. His unwavering support and guidance were invaluable throughout the entire process. I am immensely grateful for Alex's exceptional legal representation and wholeheartedly recommend his services to anyone in need of a skilled criminal defense attorney. Alex Z is not just a lawyer; he is a beacon of hope for those navigating the complexities of the legal system. If you find yourself in need of a dedicated and competent legal advocate, look no further than Alex Z.
Taïko BeautyTaïko Beauty
16:26 15 Mar 24
I don’t know where to start, I can write a novel about this firm, but one thing I will say is that having my best interest was their main priority since the beginning of my case which was back in Winter 2019. Miss Claire Banks, one of the best Attorneys in the firm represented me very well and was very professional, respectful, and truthful. Not once did she leave me in the dark, in fact she presented all options and routes that could possibly be considered for my case and she reinsured me that no matter what I decided to do, her and the team will have my back and that’s exactly what happened. Not only will I be liberated from this case, also, I will enjoy my freedom and continue to be a mother to my first born son and will have no restrictions with accomplishing my goals in life. Now that’s what I call victory!! I thank the Lord, My mother, Claire, and the Spodek team for standing by me and fighting with me. Words can’t describe how grateful I am to have the opportunity to work with this team. I’m very satisfied, very pleased with their performance, their hard work, and their diligence.Thank you team!
K MarK Mar
01:37 25 Jan 24
I recently had Spodek Law Group represent me for a legal matter in NYC and I am thoroughly impressed with their services.Alex Zhik secured the best possible outcome for my case.It was a seamless journey from the initial consultation to the resolution of my legal matter. From the moment I spoke to Todd about my case, his enthusiasm to help was evident, setting a positive tone for the entire experience. The efficiency and professionalism displayed by the team is commendable.A particularly noteworthy aspect of their service is their user-friendly portal to upload your documents/evidence. This not only simplified the process, but showcases their commitment to streamline the client experience.Lastly, in an industry where legal fees can often be a concern, I found their pricing to be very reasonable, making needing legal assistance feel accessible and stress-free.I am grateful for their support and wouldn't hesitate to turn to them again in the future.

Penalties for Insider Trading

The penalties for insider trading depend on the scope of the illegal activity as well as the intent to commit fraud. In some cases, an investor may have thought that he or she was merely acting on a tip before making a decision to buy or sell on his or her own. If that is the case, the investor may simply be required to give back the money he or she made on the illegal trade.

However, if the investor was acting to intentionally manipulate the market, fines and jail time could be forthcoming. Restitution may also be part of a sentence if fraud caused retirement funds or individual investors to make decisions based on rigged or manipulated information. It is possible to spend 10-20 years or more in a federal prison with fines of up to $1 million or more. If institutional investing firms are involved in the fraud, those firms may also face fines or other civil penalties.

Your Reputation as a Trader Could Be Ruined

If you are accused of insider trading, your reputation could be smeared or ruined for life. You may also be required to give up the right to call yourself a CPA or any other credentials that you may have earned. Furthermore, you may no longer be licensed as a stock broker or legally have the right to informally manage large sums of money on behalf of other people or entities.

How Can An Attorney Help You?

An attorney may be able to help you fight the charge of insider trading. For instance, an attorney may argue that you were ordered or compelled to engage in trading even if you knew it was illegal. Your attorney may even provide evidence that you tried to act as a whistleblower or otherwise tried to come clean.

Even if this doesn’t get the charge thrown out, your willingness to acknowledge the gravity of the situation could result in a reduced sentence. In some cases, you may be granted immunity or some other sort of plea deal by cooperating with the government in its case against your company or others involved in the insider trading scheme.

Finally, your legal counsel may help you dispute a charge by having evidence suppressed or thrown out. Expert witnesses may be able to challenge or cast doubt about any evidence used against you in trial. This could result in a hung jury or a jury that decides to rule in your favor.

If you have been charged with insider trading, it is critical that you talk to an attorney today. The sooner you consult with legal counsel, the easier it may be to create a defense that can help you beat the charge or otherwise resolve the matter in your favor.

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