I thought this was an interesting statement. In connection with dropping its investigation of Pequot Capital Management Inc. on insider trading allegations, the Washington Post discusses the investigation and finishes with the statement "without e-mails, documents or an outright admission by someone involved in a case, insider trading charges can be difficult for regulators to prove."
Is that where enforcement proceedings have evolved? If there is no email, there is no case? I have been defending insider trading cases since 1985. Believe me, the SEC can put together a very compelling case without emails, and without admissions. They have been doing it for years. In fact, the most famous insider trading cases were brought before email existed, and the balance were brought without email or admissions.
Believe me. The NASD and the NYSE have professionals watching the market every minute of every day. They will notice unusual trading, and they will investigate. To suggest that they need an email trail to move forward with a prosecution is to demean the varied prosecutors and the market surveillance teams at the exchanges, and to encourage insider trading.
They can catch it, they will catch it, and they will prosecute it. At the same time, they will go after innocent people who did not trade on inside information. Those people need the courage, and the professionals, to defend themselves, and can do so successfully.
But to suggest that admissions and emails are the only road to a successful prosecution is downright silly.
