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Clifford C. Histed

Partner
+1.312.807.4448
Fax +1.312.827.8000
Cliff Histed represents companies and individuals operating in highly-regulated industries, particularly in the areas of financial markets, trading, and health care, during both criminal and regulatory proceedings, and in representing clients in litigation and at trial.

Mr. Histed is a former supervisory federal prosecutor, supervisory enforcement lawyer with the Commodity Futures Trading Commission, and special agent with a federal Inspector General’s Office. He has more than 25 years’ experience investigating, prosecuting, and defending business frauds and criminal offenses in regulated industries, including the securities markets, the agricultural and financial futures and derivatives markets, and the healthcare field. He has supervised more than a dozen assistant U.S. attorneys in their investigation and trial of criminal fraud cases, and has tried 27 jury and nonjury cases, both criminal and civil, in federal and state courts. He has briefed eleven matters before the Second and Seventh Circuit Courts of Appeals, and argued eight of those appeals.

Mr. Histed has conducted or supervised hundreds of investigations and prosecutions, including those involving allegations of health care fraud, bribery, trade secret theft, perjury, obstruction of justice, and commodity futures and securities violations such as insider trading, price manipulation in dairy and energy futures markets, wash sales, and abusive forms of high-frequency trading, including the case U.S. v. Michael Coscia, the first case to charge the disruptive trading practice known as “spoofing” as a crime. Many of these investigations involved parallel litigation or enforcement actions brought by federal regulatory agencies, futures exchanges, bankruptcy trustees, or private litigants.

Mr. Histed speaks and writes frequently on the topic of futures and securities trading. Notable publications that have quoted Mr. Histed on the subject of disruptive trading practices and insider trading include Bloomberg News, Chicago Lawyer, Crain’s Chicago Business, Law360, Levick’s Tomorrow blog, Institutional Investor, and Forbes.

Mr. Histed has a very active pro bono practice, and has provided legal services to the Illinois Torture Inquiry and Relief Commission and Clemency Project 2014. He is a member of the Criminal Justice Act Panel for the U.S. District Court for the Northern District of Illinois which provides representation to indigent clients charged with federal criminal offenses.

Professional Background

Mr. Histed’s 25-year career included the following public and private sector organizations:

  • U.S. Attorney’s Office, Northern District of Illinois (June 2006—January 2015). Deputy Chief, Securities and Commodities Fraud Section (March 2014—February 2015); Deputy Chief, Financial Crimes and Special Prosecutions Section (July 2011—March 2014).
  • BP America, Inc. (July 2004—June 2006). Worked in both the compliance and law departments directly on the trading floor, providing regulatory advice concerning exchange-traded and over-the-counter derivatives to BP’s energy commodity traders.
  • Commodity Futures Trading Commission (August 2000—July 2004). Supervisory Trial Attorney/Team Leader June 2002—July 2004. Investigated and prosecuted civil violations of the Commodity Exchange Act and CFTC regulations, including conducting preliminary injunction hearings, taking depositions, and arguing motions in several district courts across the country.
  • Illinois Attorney General’s Office (November 1995—August 2000). Assistant Attorney General, Financial Crime Unit.
  • Office of Inspector General, U.S. Department of Education (August 1989—November 1995). As a Special Agent, Mr. Histed investigated criminal fraud against federal government programs. He is an honor graduate of both the nine-week special agent course, and the three-week Inspector General Basic Training Program, at the Federal Law Enforcement Training Center.

Professional/Civic Activities

  • American Bar Association
    • Business Law Section—Derivatives and Futures Law/White Collar Crime Committees
    • Criminal Justice Section—Computer Crime, Intellectual Property, and Trade Secrets/White Collar Crime Committees
  • Federal Bar Association
  • Chicago Bar Association
  • Securities Industry and Financial Markets Association

Speaking Engagements

  • “What to do When the U.S. Government Comes Knocking,” K&L Gates Presentation and Webinar, Phoenix, April 25, 2017.
  • “Issues in Futures Exchange Enforcement and Compliance,” K&L Gates / EY Looking Over the Horizon Energy Trading Conference, Houston, April 18, 2017.
  • “SEC, CFTC, NFA and FINRA - Examinations and Enforcement,” K&L Gates Chicago Investment Management Conference, January 26, 2017.
  • “Criminal Enforcement in the Financial Markets,” Chicago Bar Association, Futures and Derivatives Committee, January 18, 2017.
  • “Cybersecurity, Organized Crime & Other Evolving Threats: Info Sharing as a Potential Solution,” Money20/20, Las Vegas, October 23, 2016.
  • “Ethical Issues in Representing Clients Who Testify in Regulatory Investigations” and “Criminal Spoofing,” Annual Meeting of the Chicago Bar Association, Futures and Derivatives Committee, June 10, 2016.
  • The Rising Tide in Health Care Criminal Investigations,” K&L Gates Webinar, January 21, 2016.
  • Case Studies in Disruptive Trading Practices,” Futures Industry Association Expo 2015, November 5, 2015.
  • Regulatory Risks for Futures Traders – Chicago and Beyond,” Chicago Bar Association, Futures and Derivatives Committee, September 16, 2015.
  • “Regulatory Issues in Hedging and Trading Energy Derivatives,” Power-Gen Natural Gas Conference, Columbus, Ohio, August 19, 2015.
  • “Enforcement Panel Update,” Sixth Annual Conference on Futures & Derivatives, IIT Chicago-Kent College of Law, October 17, 2014.
  • “Putting Markets Under the Microscope: Trends in Securities and Commodities Fraud Enforcement,” ABA event, July 22, 2014.
In private practice, Mr. Histed has represented a variety of companies and individuals operating in highly regulated industries, including:
  • Represented a plaintiff construction contactor in a jury trial against its insurer, and helped win a multi-million dollar verdict in favor of the plaintiff.
  • Represented a commodity pool operator in a federal criminal case.
  • Represented securities and commodity traders on three continents in disciplinary matters brought by their regulators.
  • Represented individuals who had been served with subpoenas to testify before federal trial and grand juries.
  • Conducted internal investigations for companies in the health care and commodity futures industries, and represented those clients in dealings with the U.S. Department of Justice.
As an assistant U.S. attorney, Mr. Histed tried fourteen federal criminal cases, including:
  • U.S. v. Eric Bloom (2014).  Four-week trial of the former president and CEO of Sentinel Management Group, charged with wire fraud and a criminal violation of the Investment Advisers Act.  In terms of dollar loss ($665 million), this was the largest trial in the history of this district. 
  • U.S. v. Brian Hollnagel et al. (2012).  Seven-week trial of the CEO and CFO of BCI Aircraft Leasing, Inc., and the corporation, charged with fraud and obstruction of justice. 
  • U.S. v. Kevin Gore (2011).  Trial of the COO of a computer company for bank fraud and wire fraud in connection with his submission of false collateral records to a lending institution. 
  • U.S. v. David Sklena (2010).  Trial of a Chicago Board of Trade floor trader charged with fraud and violations of the Commodity Exchange Act. 
  • U.S. v. William Allen (2008).  Trial of a defendant who operated an online marketplace for the distribution of child pornography. 
Other criminal prosecutions include:
  • U.S. v. Feyfunmi Sangoleye, (Parallel criminal / civil False Claims Act investigation concerning National Institutes of Health grant funding to Northwestern University’s Comprehensive Cancer Center. The U.S. Attorney’s Office charged a professor’s business assistant with theft of federal NIH grant funds, and settled a civil FCA case against the professor).
  • U.S. v. Philip J. Baker (Prosecution of the managing director of Lake Shore Asset Management in connection with the fraudulent solicitation of nearly $300 million from investors).
  • U.S. v. Steven Dombrowski (insider trading). 
  • U.S. v. David Newman (theft of trade secrets).
  • U.S. v. Evan Brent Dooley (exceeding speculative wheat futures position limits in violation of the Commodity Exchange Act).