New York Securities Fraud Ruling Threatens US White-Collar Cases

A recent appeals court decision invalidating securities fraud convictions could undercut Justice Department enforcement of insider trading, public corruption, crypto fraud, and other white-collar crimes.

The US Court of Appeals for the Second Circuit tossed convictions on Dec. 27 of four men who coordinated to trade stocks based on leaked impending Medicare reimbursement rate changes.

The divided Manhattan panel held that the Center for Medicare and Medicaid Services’ confidential information—which two of the defendants used to earn millions at their hedge funds by shorting stocks of affected companies—didn’t qualify as “property” or a “thing of value” under wire and securities ...