Both the New York Times and the Wall Street Journal followed the recent trial and conviction of Michael Coscia in the Federal District Court in Chicago. This was the first prosecution for “spoofing” under Dodd-Frank’s anti-spoofing provision. Spoofing involves the rapid placing and then canceling of orders to try to lure investors into buying and selling at artificially high or low prices. Spoofing sounds a lot like old-fashioned-bluffing, right?
There are two interesting takeaways from this case.
First, defense lawyers for Mr. Coscia challenged the constitutionality of the anti-spoofing statute claiming that it is “hopelessly vague.” The Judge denied this motion, but Mr. Coscia’s appellate team will likely raise the constitutionality of the statute on appeal. It is possible that, at least the spoofing charges, will be tossed for vagueness.
Second, Mr. Coscia testified. Defendants facing criminal charges are not required to testify and the decision, whether or not to testify, is often debated by criminal defense lawyers and their clients. On November 2, 2015, Peter Henning of the New York Times, wrote “Whether Mr. Allend and Mr. Coscia made a good decision by testifying remains one of the great unknowns in the criminal process.” On November 9, the same author wrote, “The jury found him guilty of six spoofing charges and six counts of commodities fraud, returning its verdict after only an hour of deliberations. That may be something close to a record for deciding a complex white-collar prosecution, indicating that his testimony was far from persuasive.” Mr. Henning’s observation is brutal, but probably correct.
Fenbert & Associates, LLC, is an aggressive criminal defense firm in Chicago, Illinois. If you or a loved one is charged with a crime please call 630-917-2051 for a Free Consultation.