Martin Act Subpoena / Investigation Defense

 

The New York State Attorney General’s Office is solely responsible for enforcing the civil portion of the Martin Act. The Martin Act is powerful tool that can be utilized by the Attorney General’s office to investigate and prosecute either civilly or criminally frauds in relation to securities in New York State. The Act provides for broad based subpoena power permitting Assistant Attorney Generals to subpoena documents as well as individuals to testify at the Attorney General’s office. District Attorneys may also use such Act as a basis to file criminal charges against a person or entity and have done so with more frequency in the recent past. However, unlike the Attorney General District Attorney’s do not have the power to issue civil Martin Act subpoenas as they can only subpoena witnesses to testify or bring documents before a Grand Jury. In a Grand Jury, unless there is a waiver of immunity, such witnesses in a State Grand Jury are provided with automatic immunity from prosecution regarding the incident they testify about. However, a Martin Act subpoena requires witnesses to either provide documents or appear in the Attorney General’s office to be interviewed without any Grand Jury. Any witness may if they choose take the Fifth Amendment if called as a witness under the Act, but such assertion of one’s Fifth Amendment rights must be carefully weighed against providing testimony which may deter a civil or criminal prosecution. Occasionally the Attorney General may permit a local district attorney to engage and coordinate with its office so as to benefit from the civil and what appears to be informal use of the Martin Act.

Due to the dual civil and criminal aspects under the Martin Act the Attorney General may commence an investigation under such Act and provide the appearance of it being a civil investigation which may simply lead to fines or injunctions, when in reality the evidence collected may be used by the Criminal Division of the Attorney General’s office to present evidence to a Grand Jury and criminally prosecute its targets based on the collection of evidence conducted under the Martin Act. Also if the Attorney General uncovers any other criminal activity during the course of a Martin Act investigation such permits that office to prosecute those crimes even if unrelated to the Act itself, when under normal circumstances the Attorney General’s criminal jurisdiction is very limited outside of the Martin Act. A extreme example of this came about when Mr. Meissner was in charge of a matter within the Attorney General’s office which led to the successful prosecution of a Statutory Rape charge along with Martin Act violations when it was revealed that a Money Manager, who besides defrauding various fashion models of their funds, also had sexual relations with one when she was only fifteen years of age. The famous New York Daily News front page headline “Beauties and the Beasts” resulted from such prosecution.

When anyone receives a Martin Act subpoena duces tecum (for documents) or as subpoena ad testificandum, the witness should consult with an experienced attorney who is familiar with the Martin Act and those offices, so as properly respond to such inquiries. Poor planning and advice usually lead to irreversible consequences for the subject of such investigation. As Mr. Meissner has spent years in the Attorney General’s office personally leading Martin Act investigations, both civil and criminal, he is completely familiar with how to respond to such investigations and to advise both companies and individuals in dealing with the Attorney General’s office, so as to avoid adverse consequences. In his years as a senior prosecutor with the Attorney General’s Office Mr. Meissner successfully pursued many well publicized cases including money managers who defrauded numerous models of the Elite Modeling agency, Brokerage firms who manipulated stocks causing millions in losses to investors including a member of the Gambino family, currency traders who altered internal bank records to cover millions in losses so as to maintain their employment and bonuses, a mutual fund company who worked with short sellers to coordinate trades and manipulate stocks, as well as many other financial frauds.

If you or your company received a Martin Act subpoena and are unsure how to respond or where to find experienced counsel to assist you this is the place. Rather than seeking the typical criminal defense attorney, most of whom rarely if ever encountered the Martin Act, it is essential that the recipient of a subpoena immediately seek out experienced counsel specific to the Martin Act. The Martin Act is a complicated quasi criminal and civil statute requiring counsel who is has the years of experience and knowledge to properly advise you. The “behind the scenes” knowledge of the Attorney General’s office and the Manhattan District Attorney’s office is invaluable in properly protecting the firm’s client’s rights and limit and reduce the likelihood of adverse consequences.