Commodities Trading Violations and Federal Criminal Charges

Trading commodities can be a great way for anyone to earn a strong return on investment. Similar to trading other public securities, there are a variety of laws in place that govern how you may trade commodities. Those that are suspected of trading commodities with insider information or trading in a fraudulent manner could face federal charges.

Who Handles Commodities Trading Charges?

Today, commodities charges are handled by the CFTC. This is a federal enforcement division that handles many trading and investment charges, such as fraud and insider trading. The organization works to handle charges for federal, state and foreign trading violations. This can include handling charges related to illegal trades related to commodities, swaps, options, and futures.

What are Common Commodities Trading Violations?

There are a variety of different types of commodities trading crimes that you could be charged with. One of the most common is in regards to insider trading. While insider trading is not as rampant with commodities trading as it is with stocks, there are situations in which you could have insider data that could give you an unfair advantage on the market. If you do trade with insider information, you could be charged with a criminal act. The CFTC also commonly investigates fraudulent trading activity. This more has to do with institutional traders that may make trades that go against their reported investment strategy or if they do not provide investors with the right amount of financial detail or inaccurate data.

What are Commodities Trading Penalties?

If you are charged with a criminal commodities trading charge, there are a variety of different penalties that you could be hit with. The most common penalties are typically financial penalties that can be levied in either civil or criminal trials. These penalties will surely require you to pay back any profits you made when using insider information and could also include fairly significant punitive penalties. If you have been trading with insider information over a period of time, or if you are guilty of fraud, you could be facing imprisonment. These financial crimes can carry a variety of prison term lengths, some of which can extend for several decades depending on the scope of the crime. Those that are charged with insider information or other trading violations may permanently be restricted from trading commodities and stocks in the future. Others may simply be put on a probation plan.

Benefits of Having a Criminal Lawyer Defend You

Since commodities trading criminal charges are so serious, you need to make sure that you are properly represented by a criminal defense attorney that is knowledgeable about this type of law. Commodities trading is a very complex area of the legal world and having an experienced attorney by your side will help you to build a case that can result in the charges being dropped. The attorney will also be able to work with prosecutors and other parties to allow you to plea to a lesser charge to ensure your potential punishment is minimized. The commodities and securities market is a big earner for the US economy. This has also created numerous opportunities for fraud, misrepresentation, and abuse. These cases are on the rise, and the CFTC has intensified their investigations and prosecutions. If you have been charged with a commodities trading offense, you need to consult with a defense lawyer immediately.

CFTC Commodity Charges Investigations

Aggressive Enforcement Network

CFTC officers are very aggressive on crimes related to commodities trading. These officers have close networks with the Department of Justice, FBI, and the Attorney's office. If you are under investigation, then there is a high chance that you may face criminal charges. The CFTC is mandated with the task of enforcing the laws made by the Commodities Exchange Act. They handle all investigations that pertain to the illegal trade of futures, swaps, and commodities. The CFTC also relies on information given by the public, private businesses, and individuals. Its reach also extends to foreign governments. They also have extensive resources and networks. This is potentially why you should not take an investigation into your trading activities lightly. It is imperative that you seek advice from an experienced criminal defense lawyer.

Are You Being Investigated by the CFTC?

Immediate Action Required

If you are being investigated on commodities fraud charge or other crimes, you need to act promptly. Time is of the essence in such cases. That's not all. You also need to pay close attention to details. It is easy for a simple inquiry on your activities to turn into a criminal investigation if you do not handle the situation wisely.

Know Your Rights During Investigation

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For starters, unless you get a subpoena to give evidence or testify, you should not speak to the prosecutor or federal investigator without your lawyer. To prove white collar crimes, such as commodities fraud, there is a lot of paperwork involved. The prosecutor needs paper evidence to make a case. You are not required to hand over any documentation unless there is a warrant to that effect. If you receive a subpoena or a warrant to share any information or documents, you need to present this to your defense lawyer. The warrant should be specific, and you should not submit any papers that are not stated in the court document. There are parameters to every request. It is why you need a lawyer to guide you. For a successful defense, you need to ensure that you consult with a lawyer immediately. The chances are that the investigators have had more time to gather incriminating evidence against you. The defense lawyer needs ample time to prepare a defense that counters what the prosecution may present. You should not hesitate to bring a lawyer on board once you receive a notice of investigation from the CFTC.

Penalties for Commodity Trading Charges Offenses

Penalty Type	Description
Financial Penalties	Several penalties exist for people who have been convicted for commodities trading fraud. In such cases, the penalties given revolve around finances. If found guilty of benefiting from insider trading, then the fine amount set can even be twice the amount you received.
Punitive Damages	There are punitive penalties that apply. These always result in huge fines.
Trading Restrictions	The convicted person can lose their trading license. One can also be barred from holding the position of a director in a company.
Criminal Prosecution	While most cases are settled through arbitration, if you are found liable for crimes that involve huge amounts, the CFTC can take the charges to a criminal court. Once this happens, the defendant can face a long prison sentence.

There has been a rise in commodities fraud, as such, the CFTC is under immense pressure to bring these offenders to book. This means that they will use all measures to ensure that they prosecute as many people as they can.

Get Help From a Fraud Defense Lawyer

The CFTC is known to be aggressive and thorough in their investigations. As a brokerage firm, you could find yourself culpable due to the actions of one individual. These charges should not be taken lightly. If prosecuted, the image of your investment firm is tainted. You may never recover from negative publicity, and you will most likely lose both existing and potential clients. You cannot afford to live the matter to chance. Take a proactive measure by getting in touch with a fraud defense attorney.