Recently, Mr. Tang Lijun and Mr. Ma Lixi represented the client in the first trial of the insider trading case, which involved an amount of more than 200 million RMB. After nearly a year of defense work, the client was found to be the main offender and no other mitigating and lesser punishment circumstances, the acquittal defense program for the client to obtain the minimum sentence within the range of statutory penalties, and achieved the results of the stage defense.

Basic situation

In recent years, the state has been cracking down on insider trading. In this context, the party, Li, is the vice president of a large central enterprise group, and the amount involved amounted to more than 200 million yuan, compared with the typical cases of securities and futures crimes released by the Supreme People's Court in the past, and the party may face a heavier criminal liability. The case time span, involving multiple subjects, the relationship between each other intricate and complex, case file materials, the same defendant's insider trading amount and illegal income have reached “especially serious”. After accepting the commission, the two lawyers carefully studied the case file materials, met with the parties to understand the details of the case, took the initiative to collect evidence from the relevant personnel, face to face with the prosecutor, the judge to communicate the defense opinions, in the systematic study, on the basis of full argumentation, to determine the idea of the defense of innocence, and as a basis for a series of defense work.

Source of Dispute

There are still many controversial issues in China's current laws on insider trading. In practice, the handling of criminal cases of insider trading is often based on or referenced to administrative cases, and in the case of inconsistent standards between administrative handling and criminal adjudication, it is very easy for the judicial authorities to make wrong determinations. Combined with their previous practical experience, the two lawyers comprehensively analyzed the evidence in the case, meticulously understood the internal information decision-making process of the enterprise involved in the case, and repeatedly compared the defendant's confession and witness testimonies, raising many objections to the charges in the case.

Key Points of Defense

The defense team developed a scientific defense plan through in-depth understanding of the background knowledge of the securities market, extensive collection of typical cases of insider trading, and combining the evidence in the case. With the basic idea of innocence defense, targeted collection of evidence of innocence and timely submission of new documentary materials to the judicial authorities, the defense of innocence was conducted mainly in the following aspects, which greatly reduced the sentence of the parties.

I. Recognition of insider information

Article 52 of the Securities Law takes “having a significant impact on the market price of securities” as a prerequisite for constituting insider information. The disclosure of insider information is an information transmission type of crime. If the source information disclosed by a person with knowledge of the information cannot be recognized as insider information, the person concerned, as a person in the chain of information transmission, may not constitute a crime. In this case, the insider information to LiMou pass the information is typical of the negative information, the information of the sensitive period up to nearly a year, the project operation also occurs subversive reverse operation, LiMou's buy behavior and the information indicated by the direction of the purchase and sale of the opposite direction, can not be recognized as “have a significant impact on the securities market price” of the insider information.

Second, the determination of insider information

In this case, and li mou has information exchange with multiple people are not insider information, so li mou and related personnel communication and exchange behavior does not have criminal law evaluation significance. In fact, as a long time engaged in capital operation work, has rich experience in investment senior management of enterprises, is fully capable of their own knowledge and experience to analyze and deduce the relevant good news, and thus make investment decisions.

Third, the determination of the formation time of insider information

Article 5 of the Interpretation of the Supreme Court and the Supreme Prosecutor on Several Issues Concerning the Specific Application of Laws in Handling Criminal Cases of Insider Trading and Disclosure of Insider Information only makes principle and general provisions on the sensitive period of insider information. Since there are more than ten types of insider information, and each individual case has its own characteristics, and the legal provisions are not very clear, so that the determination of insider information in judicial practice is very different. At present, in the criminal law theory and judicial practice, many scholars and judicial authorities tend to define the formation time of insider information as “when the relevant matters have entered the stage of substantive operation and have a high possibility of realization”. In cases where the law is not very clear, the determination of the sensitive period of insider information should return to the logic of daily life and the rule of thumb, and carefully determine the point of time for the formation of insider information. In this case, the decision-making procedure of the central enterprise group is complicated and the chain is long, and the project program involved had been interrupted for a long period of time, so the sensitive period of insider information should be determined from the time when the project is restarted.

Conclusion

During the three-day court hearing, the two lawyers started the defense of innocence according to the facts and the law, and achieved good results in the trial. The defense proposed in court, criminal proof need to strictly apply the “beyond reasonable doubt” standard, the “determination letter” issued by the securities commission only has reference value, the judicial organs should make independent judgment based on the facts of the case. In addition, the court prosecutor also explicitly recognized the key facts put forward by the defense. In the end, the court of first instance to insider trading crime “particularly serious circumstances” statutory minimum penalty line. Li, as a key person in the information transmission process, received a lower sentence, and it should be considered that this case has achieved stage-by-stage defense results, and the results of the case have been affirmed by the client and his family.

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