When the Securities and Exchange Commission or the Commodities Futures Trading Commission come knocking on the door, it is rarely with good news. These two agencies are known as the toughest regulators of the federal government. Their lawyers are often sharp and determined and are every bit as skilled as the lawyers they are up against. They will hold their own in court proceedings. How the enforcement process unfolds depends in part on the moves that you make during the process. Sometimes, the difference between a prosecution and a lighter penalty are how you handle the regulators during the pendency of the investigation. Sometimes, the right approach can even mean no penalty at all. With that in mind, it is never a good idea to try to handle a securities or commodities investigation on your own. It is to come to the table with legal counsel who can help you formulate and execute a strategy.
The SEC and CFTC have both informal guidance and a different way of doing business than do most regulatory agencies. What is most important is having someone on your side who knows the rules of the road. SEC and CFTC enforcement also relies heavily on informal contacts between the agency and counsel. It is critical to be represented by a SEC And CFTC Enforcement Lawyer who can get the regulators to pick up the phone when they call.
Access is one of the most important currencies that a SEC And CFTC Enforcement Lawyer can have. Many enforcement attorneys have previously worked at one of the two agencies and may likely have a deep Rolodex of contacts at the agency who they can call when they need to discuss an issue.
SEC And CFTC Enforcement Lawyer
It is very rare that the SEC or CFTC will actually need to go to court to take legal action against a party. This is because most enforcement actions are either closed without any action taken or result in a settlement between the parties. It is seldom that a potential defendant will fight the regulators in court because they have practically every incentive to settle. The regulators will often offer much more generous settlement terms than a defendant would receive if they litigated.
One of the benefits of an enforcement attorney is that they will generally know whether the settlement that is being offered is a fair deal. Sometimes, defendants who do not accept the regulators’ settlement terms often do not get the same deal a second time. However, the attorney will also have an idea whether it makes sense to either litigate or threaten to do so. Many government enforcement attorneys may be risk averse out of fear of the career implications of losing an important case.
As you can see, there is every reason to hire an SEC or CFTC enforcement lawyer. Dealing with the government is something that takes specialized knowledge. Within that subset, financial regulation requires even more topic-specific knowledge. An SEC or CFTC enforcement action should never be left to chance given the potential for serious consequences.
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