Securities Fraud: Responding to Search Warrants and Document Requests


Securities Fraud: Responding to Search Warrants and Document Requests

Getting a search warrant or document request related to securities fraud can be scary. Let’s break down what to do step-by-step so you know how to handle it.

What is a Search Warrant?

A search warrant allows the government to enter and search private property and seize evidence. To get one, investigators have to show probable cause of a crime to a judge. If approved, they can raid a home or office and take computers, files, etc. It’s invasive so you gotta be prepared.

What’s in a Warrant?

The warrant lists what they’re looking for and where they can search. Read it closely – they can only look in the spots and for the stuff listed. If they go beyond that, object immediately and contact your lawyer.

Securing the Premises

As soon as the warrant is served, secure entrances so no one enters or leaves with stuff. Law enforcement will likely do this too but be proactive. Don’t obstruct them though – that causes more issues!

Observing the Search

Stick close by and observe what they photograph or seize. Take notes! If anything seems fishy or beyond scope, again, object on the record and contact counsel.

Making Copies

Ask to make copies of seized electronics before they leave. You want your own set to review later. They may refuse but insist if the files are critical to operations.

Employee Interviews

If they start questioning employees, have a lawyer present to monitor and object if needed. Answer only what’s in scope – nothing more! Take notes afterward on what was asked/answered.

Preserving Evidence

As soon as you can, preserve evidence related to the investigation. Collect emails, files, etc. and store securely so they aren’t deleted. Courts hate spoilation!

Conducting an Internal Investigation

Get out ahead by launching an independent internal probe. Review the preserved records plus interview folks involved. Uncover the facts yourself.

Understanding Defenses

There are defenses to securities fraud charges. Lack of intent, good faith reliance on professionals, or having policies against misconduct can all help. Discuss options with counsel.

Responding to Document Requests

Similar rules apply for document requests and subpoenas. Carefully review what is sought and object to anything improper or overbroad. Only provide what is properly requested – nothing more.

Negotiating with Investigators

Don’t be afraid to negotiate scope and timing with investigators. Narrow requests to less burden, buy time to gather records, allow more employee flexibility, etc.

Seeking a Stay

If the investigation seems misguided, seek a stay from the agency or court overseeing it. Argue there are factual disputes or it exceeds authority. A stay pauses things.

Getting that dreaded search warrant or subpoena is stressful. But handling it properly from the start can help resolve things faster and minimize damage. With the right prep, policy, and legal advice, you can survive securities fraud investigations. Stay calm, know your rights, and let your lawyers lead the charge!