Common White-Collar Charges for Investment Bankers

Posted by Joseph D. Lento | Sep 09, 2022 | 0 Comments

Any profession that deals directly with money is going to include temptations to commit crime. Investment banking is no different. Crimes that are committed by investment bankers are typically of the white-collar variety and tend to be prosecuted at the federal level.

Securities Fraud/Insider Trading

Investment bankers are in a better position than nearly anyone to commit fraud centered around stocks or investments. Under the United States legal code, these crimes fall under the umbrella of securities fraud. Like all fraud, this type is criminal in nature. In public discourse, securities fraud may be referred to by the specific type of offense. Infamous financial crimes prosecuted as securities fraud include:

  • Insider Trading
  • Ponzi schemes
  • Pyramid schemes
  • Hedge fund fraud
  • Stock churning
  • High-yield investment fraud
  • Advanced fee schemes
  • Late-day trading

Internet-based fraud can also be charged under securities fraud if it involves the manipulation of the stock market. The most common example of this is the pump-and-dump scheme, which happens when an individual knowingly spreads false information on the internet in order to increase the value of the stocks.

Charged With Securities Fraud?

The Securities and Exchange Commission (SEC) is the federal department responsible for prosecuting securities crimes. Penalties for a securities fraud conviction can vary wildly based on the nature of the alleged crimes. Probation and a $10,000 fine are the usual baseline for a smaller offense, but enormous fines and significant jail time are possible based on the number of people defrauded and the sum of money involved. Even if you weren't a major part of the criminal activity, you may still face conspiracy charges if you were aware the crimes were taking place.

Some of the most effective defenses to securities fraud are:

  • Argue that you sincerely believed the action you were taking was in the best interest of the investor
  • Claim no knowledge of the specific rules that were violated (post-conviction for lighter sentence)
  • Argue regulatory errors such as unlawful search and seizure

If you have been charged with securities fraud, consult an attorney to determine the best course of action moving forward.

Other White-Collar Crimes Committed by Investment Bankers

Investment bankers are also vulnerable to state and federal financial crimes that are not uniquely investment based.

Embezzlement is a white-collar federal crime that involves diverting and misappropriating funds from their intended destination for personal gain. For example, a hedge fund manager could “skim” by not investing the full amount originally promised and pocketing the difference.

Money laundering and tax evasion are both serious federal crimes that pertain to the hiding and manipulation of financial income. Regardless of whether the money in question is yours or a client/investor's, you could still be charged.

Retain a Criminal Defense Lawyer

Joseph D. Lento is an experienced New Jersey criminal defense attorney who assists with white-collar crimes at both the state and federal levels. You do not want to take financial crimes lightly. Reach out to the Lento Law Firm online or by calling 888-535-3686 to discuss your case.

About the Author

Joseph D. Lento

"I pride myself on having heart and driving hard to get results!" Attorney Joseph D. Lento passionately fights for the futures of his clients in criminal courtrooms in New Jersey and nationwide. He does not settle for the easiest outcome, and instead prioritizes his clients' needs and well-being. With unparalleled experience occupying several roles in the criminal justice system outside of being an attorney, Joseph D. Lento can give you valuable behind-the-scenes insight as to what is happening during all phases of the legal process. Joseph D. Lento is licensed in New Jersey and New York, and is admitted pro hac vice as needed nationwide. In the courtroom and in life, attorney Joseph D. Lento stands up when the bell rings!


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When it comes to criminal defense cases, you need the right person in your corner. To learn more about how Mr. Lento can help you, call the Lento Law Firm today at 888-535-3686. or contact him online.

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