Day Pitney's Securities Enforcement Defense group has extensive experience defending entities and individuals nationwide in investigations and enforcement actions by the SEC, FINRA, NYSE and the securities divisions of the various states.
The group is headed by Jeffrey Plotkin, a former Assistant Regional Administrator of the SEC's New York Regional Office. Other lawyers in the group include a former U.S. Attorney, several former Assistant U.S. Attorneys, a former Assistant District Attorney, and several seasoned securities litigators. Our depth of experience allows us to effectively represent clients not only in regulatory proceedings but also in parallel criminal proceedings by federal and state prosecutors.
Enforcement Defense
We have successfully defended clients in connection with securities enforcement investigations and actions covering a wide range of subject matters, including but not limited to:
- Insider trading
- Public company accounting and financial disclosure fraud
- Hedge fund fraud
- Market manipulation and other trading abuses
- Foreign Corrupt Practices Act (FCPA)
- Research analyst conflicts and disclosures
- Investment adviser fraud
- Auditor negligence and secondary liability
- Broker-dealer operations
- Fixed income sales and trading practices
- Derivatives trading
- Mutual fund market timing and late trading
- Unregistered securities
- Unregistered broker-dealers and investment advisers
We have an established track record of convincing regulators to close out their investigations against our clients without taking action against our clients. On numerous occasions, we have persuaded SEC, FINRA and NYSE staff, through the Wells submission process, to reverse their preliminary determinations to recommend enforcement actions against our clients.
We have also assisted clients in reaching favorable settlements with regulators to avoid litigation and the attendant risks, expense and adverse publicity. Where settlement has not been possible or desirable, our clients have benefited from our considerable trial and appeals experience.
We also represent corporate and individual victims of fraud in connection with regulatory and criminal investigations by coordinating communications with the regulators and prosecutors; handling electronic and hard-copy document production, witness preparation, and confidentiality protection; and advocating with respect to restitution, forfeiture and other remedial payments.
Special Projects
Based on their reputation for excellence and integrity, the lawyers in the Securities Enforcement Defense group are regularly called upon by the courts, the Department of Justice, securities regulators and regulated entities to perform special consulting projects, including:
- Appointment by the Department of Justice to serve as the monitor of an international bank for a three-year period in connection with the Enron prosecutions, to monitor implementation of agreements reached among the bank, the DOJ and other domestic and foreign government regulatory entities.
- Appointment by the Department of Justice to serve as the monitor of a publicly traded multibillion-dollar managed care company for an 18-month period to oversee and report on the company's compliance with the terms of a deferred prosecution agreement arising from the company's fraudulent accounting and reporting of Medicaid obligations.
- Appointment by a federal district court to serve as the distribution agent in a $67 million SEC Fair Fund distribution to investors harmed by a public company's financial disclosure fraud.
- Appointment by the SEC to serve as the plan administrator to monitor a $50 million Fair Fund distribution to investors harmed by a broker-dealer's nondisclosure of conflicts of interest in the sale of mutual funds.
- Appointment by an NYSE specialist firm to serve as the independent consultant pursuant to settlements with the SEC and NYSE of enforcement actions concerning inter-positioning and trading ahead of customer orders on the NYSE, by conducting a review of policies, procedures and systems for handling of customer order flow on NYSE and recommending amendments and revisions to policies, procedures and systems to ensure compliance with SEC and NYSE rules.
- Appointment in successive years by an NYSE specialist firm to serve as the independent third-party auditor pursuant to NYSE Rule 104(h) to conduct a review of all specialist systems employing algorithms and all specialist trading algorithms to ensure that they operated in accordance with SEC and NYSE rules.
- Retention by various broker-dealers and investment advisers to revise their written supervisory procedures to prevent recurrence of violations and misconduct.
