Legal Question in Securities Law in California

Re: Rights in Securities Investigation

Your responsibility to cooperate in an investigation depends significantly upon what your position or role is, and what type of information is being sought. For example, if you hold a securities license or are employed by a licensed broker-dealer, you almost certainly have an affirmative duty to cooperate in any official investigation, whether or not charges are brought. On the other hand, if you are merely a customer of an NYSE firm, you have substantial privacy rights and you are entitled to a full measure of due process before you have to divulge much information.

If there is, based on your sense of the situation, some chance that you will be charged with wrongdoing, find out whether the prospective penalties are purely civil or whether criminal charges are possible. If the latter, see an attorney about your 5th Amendment rights before divulging anything that could be used against you personally.

If you are an employee rather than the top officer of a broker-dealer, you should probably consider going to your firm's compliance officer for legal and policy advice. If you are the top officer, retain an attorney or consult with the attorney(s) you have used in the past regarding compliance matters.