If an SEC investigation is pending and diving into the legalese doesn’t sound like an appealing idea, it might be worth taking the time to prepare before you meet with your potential counsel. You need to know that the best time to hire an SEC defense lawyer is before you’re in trouble. That’s not because legal counsel is always infallible, but because the attorney can help you keep your options open and minimize your risk.
A lawyer also can help you navigate complex document reviews, which will save valuable time for both you and the SEC investigation team. If hiring a competent, thorough attorney sounds like something that could benefit you and your company.
The SEC’s Regulatory Overview:
The Securities and Exchange Commission (SEC) is a federal agency that is responsible for monitoring securities markets in the United States. The SEC´s main purpose is to protect investors and ensure that companies that sell securities to investors comply with the federal securities laws. The SEC is also responsible for monitoring financial markets and implementing new rules to prevent corporate fraud. For example, if you have insider information about a stock or security, you are not allowed to trade on it because you will have an unfair advantage over other investors in the market.
The SEC investigates possible securities violations and brings charges against individuals or companies that break the law. If a company violates the law and issues fraudulent securities, it can be charged with securities fraud. If you are an individual investor and you are aware of potential fraud on the part of a company, you can report this to the SEC. The SEC will investigate your claim, and if it believes that a violation has occurred, it will take action against the company by issuing fines or demanding restitution for investors.
5 Things to Know Before You Hire:
1. Substantial experience in SEC investigations and litigations:
If you need counsel to represent you in an SEC investigation, you want the SEC lawyers to be familiar with the regulatory agency. Not only should the attorney have experience with other clients that were charged with securities violations, but he or she should also know how the SEC works. There are a lot of rules and regulations surrounding this type of investigation, and your lawyer must be familiar enough to understand them and guide you on how best to proceed.
2. In-depth working knowledge of the federal securities laws:
While the SEC is responsible for monitoring the securities market in the United States and ensuring that companies are compliant with federal rules, they are often behind the curve on new, innovative financial technologies. An attorney should be familiar with the regulatory landscape so that he or she can advise you on whether your financial product may fall under SEC jurisdiction. If it does, your lawyer will know which rules and regulations you need to follow and how to protect yourself.
3. Open and willing attitude to answer questions about your case during each stage of the SEC’s investigation:
If you want to keep the SEC out of your case, you need a lawyer that is open and transparent during the investigation. While you could theoretically have an attorney who is unwilling to answer any questions or give you advice, a defense attorney should be more than willing to answer questions and share information with you. An attorney that refuses to respond or give insight into your case will negatively impact his or her ability to help you, as well as his or her reputation with other clients in the future.
4. Strong dedication and sincerity to helping you:
When you are dealing with the SEC, you need to focus on getting your business or investment back on track rather than spend time-fighting the SEC. You also must be confident that your lawyer will work hard to get you cleared of any wrongdoing. To ensure that your defense lawyer is working as hard for you as possible, he or she should be willing to devote considerable time and attention to your case. Your lawyer should also follow up frequently with your company and the SEC investigators.
5. Open and regular communication policy with clients:
Communication is critical when you are dealing with the SEC. You need to know what is happening in your case and how you can minimize the risk that it will have a negative impact on your business or investment. The best way to get these updates is by creating and maintaining open lines of communication with your defense attorney. For example, your lawyer should create an email account dedicated to his or her SEC clients so that all communication regarding your case is accessible only to the two of you, rather than through public email.
If you do not want to be implicated in a possible SEC investigation, it is critical that you hire a defense lawyer as soon as possible. Doing so will help you maximize your chances of a successful outcome, and the skilled, experienced defense lawyer can help you navigate complex document reviews and analyze potential evidence against your company or against yourself.