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Category Archives: Compliance

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Compliance, Financial Institution Regulation

Marketplace Lenders May Be Supervised by CFPB in 2017

The Consumer Financial Protection Bureau (CFPB) plans to begin supervising online “peer-to-peer” or “platform” lenders as soon as late 2017, according to the Wall Street Journal. The Journal reported that this oversight is part of the agency’s previously announced intent to monitor the largest lenders offering small-dollar loans and lenders that offer loans secured by… Continue Reading
Compliance, Financial Institution Regulation

Senators Take Steps to Ban Arbitration Clauses in Telecommunications Contracts

On Thursday, April 28, 2016, Senators Al Franken (D-Minn.) and Richard Blumenthal (D-Conn.) proposed legislation that would ban arbitration clauses in telecommunication service contracts. The proposed bill, the Justice for Telecommunications Consumers Act of 2016, would invalidate “any agreement to arbitrate a dispute that has not yet arisen at the time of the making of… Continue Reading
Compliance, Immigration and Worksite Enforcement

Buyer Beware: Noncompliant Electronic I-9 Software Risks Customer Company Fines

Electronic I-9 software can be very attractive to companies looking for efficiency and ensuring compliance. Not to mention the elimination of file drawers that once housed these voluminous paper I-9 files. However, buyers beware, not all electronic I-9 software meets the federal regulations’ requirements. And the problem for well-meaning companies: ICE will still hold the… Continue Reading
Compliance, Enforcement and Prosecution Policy and Trends, Financial Institution Regulation

CFPB’s First-Ever Data Security Enforcement Action

Earlier this month, the Consumer Financial Protection Bureau (CFPB) made headlines by bringing its first enforcement action in the data security space.  Dwolla, Inc., an Iowa-based online payment processor, was the CFPB’s target.  According to CFPB Director Richard Cordray, “With data breaches becoming commonplace and more consumers using these online payment systems, the risk to… Continue Reading
Compliance, Financial Institution Regulation

CFPB Director Forecasts Rulemaking on Consumer Arbitration Clauses in American Constitution Society Speech

In the latest public pronouncement on the Consumer Financial Protection Bureau’s (CFPB’s) intention to engage in rulemaking to ban the use of certain arbitration clauses in consumer contracts – in particular, those that would limit consumer class relief – CFPB Director Richard Cordray recently elaborated on the CFPB’s goals in a speech to the American… Continue Reading
Anti-Bribery and Corruption, Compliance

SHARPER TEETH FOR SANCTIONS ENFORCEMENT?

The current UK sanctions enforcement regime is a complicated web reflecting the requirements of UN Security Council Regulations, EU Regulations, and UK Primary and Secondary Legislation.  Penalties for breaches of sanctions are generally set out in the various statutory instruments that implement particular sanctions. The UK Government, through the Policing and Crime Bill that is… Continue Reading
Anti-Bribery and Corruption, Compliance, Enforcement and Prosecution Policy and Trends, Securities and Commodities

Key Takeaways From This Year’s Early FCPA Enforcement Actions

February has been a big month for U.S. Foreign Corrupt Practices Act (FCPA) enforcement. It started with the U.S. Securities and Exchange Commission (SEC) quietly resolving a string of relatively small matters.  Then, at the end of last week, the SEC and U.S. Department of Justice (DOJ) entered into a global resolution with VimpelCom in… Continue Reading
Compliance, Sanctions, Trade Embargo, and Export Controls

Iran Sanctions and the Implementation of the JCPOA: Lots of Changes, but Little Impact on U.S. Businesses?

In recent days, the news has been full of stories referring to the “end” or “lifting” of U.S. sanctions against Iran, actions that were taken after the International Atomic Energy Agency confirmed on January 16, 2016, that Iran has met its obligations under the July 14, 2015, Joint Comprehensive Plan of Action (JCPOA) in connection… Continue Reading
Compliance, Securities and Commodities

PCAOB Adopts Audit Engagement Partner Disclosure

On December 15, 2015, the Public Company Accounting Oversight Board (PCAOB) continued its pursuit of providing investors with improved audit transparency and audit accountability by adopting new rules requiring auditors to disclose: the name of the engagement partner; the name, location and extent of participation of any other accounting firm participating in the audit whose… Continue Reading
Compliance, Financial Institution Regulation, Securities and Commodities

SEC Provides Guidance on 2016 Examination Areas of Focus

On Monday, January 11, 2016, the Securities and Exchange Commission (SEC) announced its Office of Compliance Inspections and Examinations’ (OCIE) areas of focus for 2016, which include: protecting retail investors and investors for retirement; assessing issues related to market-wide risks; and use of its ability to analyze data to identify and examine registrants that may… Continue Reading
Anti-Money Laundering, Compliance, Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Fraud, Deception and False Claims

FinCEN Announces First Card Club AML Enforcement Action

Just in time for Christmas, the Financial Crimes Enforcement Network (FinCEN), the financial industry (including casinos and card clubs) regulator, announced its first-ever enforcement action against a card club, California’s Oaks Card Club (Oaks). The enforcement action, which carried a penalty of $650,000, is the latest in a string of actions against gaming enterprises and is… Continue Reading
Compliance, Financial Institution Regulation, Immigration and Worksite Enforcement

Proposed Changes to Form I-9 Create New Compliance Questions

Employers take note: a new Form I-9 is in the making.  U.S. Citizenship and Immigration Services (USCIS), part of the Department of Homeland Security, announced on November 24, 2015, that it is seeking public comment on the various proposed changes.  The proposed changes will have far-reaching impact because all employers are required to complete and… Continue Reading
Anti-Bribery and Corruption, Compliance, Enforcement and Prosecution Policy and Trends, Fraud, Deception and False Claims, Uncategorized

Cooperation, Leniency, Internal Investigations, Self-Incrimination, Privilege and All That Jazz

I recently attended a Fraud Conference in Miami where I heard a French lawyer insisting that since he was a defence advocate, his job was to defend his clients against fraud allegations, not to prosecute them.  Instead of cosying up to the authorities, and self-reporting, he regarded it as his duty to challenge the prosecutor and… Continue Reading
Compliance, Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Securities and Commodities

SEC Enforcement Continues to Pursue Hedge Fund Advisers

The SEC continues to pursue enforcement actions against hedge fund managers for alleged self-dealing, undisclosed conflicts of interest, and valuation issues. As we’ve previously reported (here and here), the SEC has stepped up its review and enforcement of private fund managers following Dodd-Frank, which required most investment advisers to private funds to register with the… Continue Reading
Compliance, Enforcement and Prosecution Policy and Trends, Financial Institution Regulation

Hudson City Savings Bank Reaches Largest Mortgage Redlining Settlement in DOJ History

The CFPB, DOJ, and Hudson City Savings Bank, F.S.B. (“Hudson City”) recently entered into the largest residential mortgage redlining settlement in DOJ history. On September 24, 2015, the parties filed a Joint Motion for Entry of Consent Order that resolves allegations of discriminatory practices of redlining in predominately Black and Hispanic neighborhoods. The consent order… Continue Reading
Compliance, Securities and Commodities

SEC’s OCIE Issues a Second Cybersecurity Risk Alert

On Sept. 15, 2015, the Securities Exchange Commission (SEC) Office of Compliance Inspections and Examinations (OCIE) published its second cybersecurity risk alert (the “2015 Risk Alert”). The 2015 Risk Alert is a follow up to the OCIE’s April 2014 cybersecurity initiative risk alert (the “2014 Risk Alert”) announcing a series of examinations to identify cybersecurity… Continue Reading
Compliance, Enforcement and Prosecution Policy and Trends

Thirteenth Individual Convicted in Medicare Psychiatric Treatment Fraud

On September 10, a Houston psychiatrist became the thirteenth individual convicted in relation to partial hospitalization program (PHP) services fraudulently billed to Medicare. The psychiatrist was convicted by a federal jury and is scheduled to be sentenced in December. The government has charged numerous individuals with causing Houston’s Riverside General Hospital to submit approximately $158… Continue Reading
Anti-Money Laundering, Compliance, Enforcement and Prosecution Policy and Trends, Financial Institution Regulation

FinCEN Announces Caesars Penalty After Multiyear Investigation

This week the Financial Crimes Enforcement Network (FinCEN) announced a Consent Agreement that imposed an $8 million civil penalty against Desert Palace, Inc. d/b/a Caesars Palace. Caesars first disclosed the investigation in SEC filings in late 2013. The investigation grew out of a 2012 audit performed by FinCEN’s examiner, the Internal Revenue Service Small Business/Self-Employed… Continue Reading
Anti-Bribery and Corruption, Anti-Money Laundering, Compliance

SEC and FinCEN Delivering One-Two Punch to Private Equity

Starting in January, it was widely reported that the SEC had upped its FCPA scrutiny of private equity funds required to register as investment advisers under Dodd-Frank, with requests for information being issued to a number of funds in connection with their courting of sovereign wealth funds. For many newly-regulated funds, this was likely viewed… Continue Reading
Anti-Bribery and Corruption, Compliance, Enforcement and Prosecution Policy and Trends

Anti-Corruption Enforcement in Brazil is in High Gear

Headlines of Brazil’s push to fight corruption are everywhere. The Petrobras scandal involves contracts worth billions of dollars, and prosecutors have uncovered a U.S. connection. The public is outraged and has called for President Dilma Rousseff’s impeachment, as the speaker of Brazil’s lower house of Congress and a former president of Brazil face recently filed… Continue Reading
Compliance, Enforcement and Prosecution Policy and Trends, Securities and Commodities

SEC Issues Wells Notice to Pimco Over Fund Valuations

On Monday, August 3, 2015, Pacific Investment Management Co. LLC (Pimco) announced that it had received a Wells notice from the Securities and Exchange Commission concerning the valuation of certain nonagency mortgage-backed securities in its popular, exchange-traded Pimco Total Return ETF fund. The notice indicated that the SEC staff had made a preliminary determination to… Continue Reading

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