As previously discussed here, I was just about speechless when I read about the former Nixon Peabody associate charged with insider trading by the SEC. As I said then, "the chance of this lawyer getting away with the insider trading alleged by the SEC was Z-E-R-O, and that is only because we cannot go below zero, otherwise it would have been lower."

Well, guess what? It gets worse.

Yesterday, federal prosecutors in Washington charged the former associate, Melissa Mahler, with the crime of making false statements to SEC investigators. The Blog of the Legal Times reports that according to prosecutors, on Nov. 29, 2004, Mahler conducted a telephone interview with two SEC lawyers who interviewed Mahler over the telephone and asked her about the Teleplus trade. In that interview, "Mahler allegedly denied that she placed the order and said she only found out about the trade when she received her account statement from her broker. She also said her husband had the authority to make purchases on her account." In fact, prosecutors allege, "Mahler knew about the trade, having allegedly made it herself. The charges also say that her husband does not have the authority to make trades on her brokerage account."

So prosecutors are now charging Mahler criminally, as well, for allegedly making a false statement to investigators in violation of 18 USC Section 1001.