Subject to Inquiry

Subject to Inquiry

THE LATEST ON GOVERNMENT INQUIRIES AND ENFORCEMENT ACTIONS

Government Investigations and White Collar Litigation Group

Government Investigations Group

Photo of Government Investigations Group Government investigations and related enforcement actions and litigation can take many forms, but they have one element in common: They require seasoned counsel to help clients navigate these difficult situations when their businesses and reputations are on the line. McGuireWoods’ national Government Investigations & White Collar Litigation Department has the experience and credibility clients have come to trust with their most sensitive matters.

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CFPB Announces Intent to Reconsider Disclosure Rule

By Government Investigations Group on Compliance, Financial Institution Regulation
On December 21, 2017, the Consumer Financial Protection Bureau (CFPB) issued a public statement regarding implementation of the Home Mortgage Disclosure Act (HMDA), noting that it plans to reconsider aspects of the mortgage data rule. The HMDA, enacted in 1975, requires many lenders to report information concerning applications they receive for particular mortgage loans and… Continue Reading

Pending U.S. Supreme Court Case Could Impact Judicial Deference to Agency Rulemaking

By Government Investigations Group on Compliance
A petition for certiorari pending before the U.S. Supreme Court has the potential to narrow the application of Chevron deference to agency rulemaking.  Under Chevron U.S.A. v. Natural Resources Defense Council, a 1984 Supreme Court case that is widely considered a foundational case in administrative law, courts interpreting an ambiguous provision of a federal statute… Continue Reading

FINRA Continues to Prioritize Examinations of High-Risk and Recidivist Brokers

By Government Investigations Group on Enforcement and Prosecution Policy and Trends
In its 2017 Regulatory and Examination Priorities Letter, FINRA made clear that one of its top priorities is identifying high-risk brokers and ensuring that their firms properly monitor them. To assist it in doing so, FINRA has established a dedicated examination unit to identify and examine brokers who may pose a high risk to investors.… Continue Reading

Expansion of FCPA “Pilot Program” is Good for Companies, but Heed the Fine Print

By Government Investigations Group on Anti-Bribery and Corruption
Deputy Attorney General Rod Rosenstein’s Nov. 29 announcement that the Department of Justice FCPA “Pilot Program” will be permanently expanded is good news for companies that repeatedly faced the dilemma of whether or not to investigate and disclose FCPA issues discovered internally. However, companies should be careful to read the fine print of the policy… Continue Reading

SEC to Begin Regulating Initial Coin Offerings More Heavily

By Government Investigations Group on Enforcement and Prosecution Policy and Trends, Securities and Commodities
On November 16, 2017, U.S. Securities and Exchange Commission (SEC) Chairman Jay Clayton announced in a symposium on cybersecurity and financial crimes that the SEC would start taking enforcement action against coin offering issuers who fail to register with the SEC. As cryptocurrencies, like Bitcoin, have become increasingly popular, startup companies have turned to a… Continue Reading

SEC Approves New PCAOB Standard

By Government Investigations Group on Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Securities and Commodities
Recently, the SEC approved the PCAOB’s new auditor reporting standard, AS 3101, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion. Hailed as the most significant change to the auditor report’s format in over 70 years, AS 3101 significantly changes the format of the existing auditor’s report, arming… Continue Reading

Profiting from Human Rights Abuses

By Government Investigations Group on Enforcement and Prosecution Policy and Trends
The Criminal Finances Act 2017 runs to nearly 150 pages. It was hurried through Parliament shortly before the June 2017 election.  It is an example of lazy and confusing legislating, where numerous sections and sub-sections are added on to existing legislation, giving rise to the creation of sections numbered 339ZD and 396L which pile uncertainty… Continue Reading

Will Supreme Court Narrow The Broadest Tax Crime?

By Government Investigations Group on Enforcement and Prosecution Policy and Trends
In the October 2017 term, the Supreme Court will take up its first criminal tax case in almost a decade, Marinello v. United States.  At issue is a longstanding circuit split about a mainstay of the federal government’s arsenal in financial crime cases, the tax obstruction statute, which makes a felon of anyone who “corruptly… Continue Reading

Recent Privilege Decision Raises Questions for Internal Investigations

By Government Investigations Group on Enforcement and Prosecution Policy and Trends
A recent federal district court case raises significant issues regarding privilege that should be on the radar of any in-house or outside counsel conducting an internal investigation with the goal of producing a public report. As discussed in a recent Privilege Points, the investigation at issue was conducted for the Washington Metropolitan Area Transit Authority… Continue Reading

Ninth Circuit Ruling Weakens Materiality Standard under the FCA

By Government Investigations Group on Fraud, Deception and False Claims
Last year in Universal Health Services, Inc. v. United States ex rel. Escobar et al. (discussed on this blog), the Supreme Court reminded litigants that the False Claims Act “is not an all-purpose antifraud statute.” In that case, the Court expanded upon the FCA’s materiality standard, calling it both “rigorous” and “demanding.” How demanding that… Continue Reading

DOJ Takes Down AlphaBay, the World’s Largest Dark Web Marketplace

By Government Investigations Group on Enforcement and Prosecution Policy and Trends
The U.S. Department of Justice has announced the seizure of AlphaBay, the largest criminal marketplace on the Internet, which was used to sell stolen financial information, identification documents and other personal data, computer hacking tools, drugs, firearms, and a vast number of other illegal good and services throughout the world. AlphaBay was the largest dark… Continue Reading

CFPB Issues Game-Changing Rule On Arbitration Clauses

By Government Investigations Group on Financial Institution Regulation
On Monday, July 10, 2017, the Consumer Financial Protection Bureau (CFPB) issued a game-changing final rule regarding the use of arbitration clauses in consumer contracts.  The Rule is effective 60 days following its publication in the Federal Register and applies only to contracts entered into more than 180 days after that date.  The final rule… Continue Reading

CFPB Provides Updated Guidance Related to Loan Forgiveness Program

By Government Investigations Group on Compliance, Financial Institution Regulation
On Thursday, June 22, 2017, the Consumer Financial Protection Bureau (CFPB) provided updated guidance for supervisory examinations of student loan servicers.  Richard Cordray, the Director of the CFPB, gave prepared remarks in Washington D.C.  He explained his concerns related to the Public Service Loan Forgiveness program and how certain practices may be delaying or denying… Continue Reading

U.S. Supreme Court Indirectly Limits Important Component of DOJ’s FCPA Pilot Program

By Government Investigations Group on Enforcement and Prosecution Policy and Trends
On June 5, 2017, the U.S. Supreme Court unanimously held in Kokesh v. Securities and Exchange Commission, No. 16-529, that the SEC may not reach beyond the general five year statute of limitations period in order to obtain “ill-gotten gains,” a remedy known as disgorgement. Although the case did not involve a Foreign Corrupt Practices… Continue Reading

SEC Issues Guidance in Wake of WannaCry Ransomware Attack

By Government Investigations Group on Financial Institution Regulation, Securities and Commodities
On Friday, May 12, the WannaCry ransomware attack struck hundreds of thousands of users across the globe, causing major disruptions in private and public networks. The attack, which encrypts a user’s files and holds them for ransom, may infect a computer without any action taken by the user.  With similar attacks expected, and as we… Continue Reading

FINRA President and CEO Robert Cook discusses FINRA360 and Consolidating Enforcement Divisions

By Government Investigations Group on Financial Institution Regulation, Securities and Commodities
On May 17, 2017, at the annual FINRA conference in Washington D.C., FINRA President and CEO Robert Cook discussed the recently-launched FINRA360 initiative: a top-to-bottom review of FINRA’s operations and organization.  Cook recognized that 2017 marks FINRA’s  ten-year anniversary since its “successful” but “complicated” merger of the National Association of Securities Dealers (NASD) and the… Continue Reading

The CFPB’s Alternative Data RFI: Making Your Response Count

By Government Investigations Group on Financial Institution Regulation
The Consumer Financial Protection Bureau (CFPB) recently issued a Request for Information (RFI) Regarding Use of Alternative Data and Modeling Techniques in the Credit Process, available here.  The deadline for response is May 19.  This post will provide practical advice on how to submit an effective RFI response. The RFI is the latest in a… Continue Reading

President’s Proposed Budget Increases Healthcare Fraud Enforcement Funding

By Government Investigations Group on Enforcement and Prosecution Policy and Trends, Fraud, Deception and False Claims
Much of the discussion surrounding President Trump’s 2018 budget blueprint has focused on cuts, but one proposed budget increase shows the new administration is likely to continue focusing on healthcare fraud enforcement.  Among cuts of approximately 18% to the budget of the Department of Health and Human Services (HHS), the president’s budget proposes $70 million… Continue Reading

Will 2017 Be the Year of Insider Trading Reform?

By Government Investigations Group on Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Fraud, Deception and False Claims
For several years running, insider trading has been among the most high-profile enforcement priorities for both DOJ and the SEC. Unlike most federal criminal law, insider trading remains undefined by statute, having instead been largely judge-made. Unsurprisingly, since the explosion of enforcement actions began, prosecutors and defendants have both pushed the courts to clarify (or… Continue Reading

D.C. Circuit Grants Rehearing in PHH Case

By Government Investigations Group on Financial Institution Regulation
On Thursday, February 16, 2017, the D.C. Circuit granted the Consumer Financial Protection Bureau’s (CFPB) petition for rehearing en banc in PHH Corporation v. Consumer Financial Protection Bureau.  The Order marks the latest twist in a case that tests the constitutional and statutory limits of the CFPB. As we previously reported, in 2014 an Administrative… Continue Reading

Pending Senate Bill Would Restructure CFPB Leadership

By Government Investigations Group on Financial Institution Regulation
On January 11, 2017, a trio of Republican Senators introduced a bill that would change the leadership structure of the Consumer Financial Protection Bureau (“CFPB”) from a single director to a five-member bipartisan “Board of Directors.” Senate Bill 105, titled “Consumer Financial Protection Board Act of 2017,” introduced by Senators Deb Fischer (R-Neb.), Ron Johnson… Continue Reading

Will Cryptocurrency Abuse be an Enforcement Focus for the IRS this Tax Season?

By Government Investigations Group on Enforcement and Prosecution Policy and Trends
Tax filing season began January 23rd, and with its arrival the IRS began rolling out its annual list of the so-called “Dirty Dozen.” The Dirty Dozen list is an educational effort to inform the public about scams, but it also offers insight into the tax enforcement issues on the IRS’s radar. Particular tax schemes often… Continue Reading

Trump Signals Beginning of Efforts to Curtail Dodd-Frank

By Government Investigations Group on Financial Institution Regulation
On February 3, President Donald J. Trump signed an executive order that signaled the beginning of the Trump Administration’s efforts to dismantle parts of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”).  The executive order, entitled Core Principles for Regulating the United States Financial System (“Order”), lays out seven core principles (“Core Principles”)… Continue Reading

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