Subject to Inquiry

Subject to Inquiry

THE LATEST ON GOVERNMENT INQUIRIES AND ENFORCEMENT ACTIONS

Government Investigations and White Collar Litigation Group

Search Results for:

Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Securities and Commodities

SEC Charges Its First Robo Actions – Increasing Scrutiny of the Investment Platform

By Cheryl Haas, Emily P. Gordy and Natasha S. Cooper

It was never a question of if, but rather, when the Securities and Exchange Commission would launch its first charges against robo-advisors and what those charges would be. Following then-SEC Chairperson, Mary Jo White’s keynote address at the SEC-Rock Center on Corporate Governance in 2016, regulators have been carefully monitoring robo-advisors’ compliance with the Investment… Continue Reading

Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Securities and Commodities

Does United States v. Ying Expand the Knowledge Requirement for “Classical” Insider Trading?

By Daniel A. Goldfried

On March 14, 2018, the SEC and DOJ sued Jun Ying, a former Chief Information Officer within an Equifax Inc. business unit, for insider trading. Specifically, they accused him of knowing about a significant Equifax data breach prior to its public disclosure and, while in possession of that material nonpublic information, exercising his Equifax options… Continue Reading

Enforcement and Prosecution Policy and Trends, Securities and Commodities

SEC to Begin Regulating Initial Coin Offerings More Heavily

By Nicholas B. Lewis and Brian C. Wanglin

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

Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Securities and Commodities, Uncategorized

SEC Approves New PCAOB Standard

By James C. Freije

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

Enforcement and Prosecution Policy and Trends, Securities and Commodities

U.S. Supreme Court Rules Time Limits Apply to SEC Disgorgement Orders

By Louis D. Greenstein, Daniel A. Goldfried, Ghillaine A. Reid, Noreen Kelly, William E. Goydan and James C. Freije

A unanimous United States Supreme Court held Monday, in Kokesh v. Securities and Exchange Commission, that the five-year statute of limitations under 28 U.S.C. § 2462 applies to disgorgement sought by the Securities and Exchange Commission. Previously, the Circuits had been split on this issue. The issue in Kokesh was straightforward. Kokesh appealed a trial… Continue Reading

Financial Institution Regulation, Securities and Commodities

SEC Issues Guidance in Wake of WannaCry Ransomware Attack

By Nathan R. Pittman

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

Financial Institution Regulation, Securities and Commodities

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

By Julian Cokic

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

Anti-Money Laundering, Enforcement and Prosecution Policy and Trends, Securities and Commodities

SEC Opens Cease-and-Desist Order Proceeding against Broker-Dealer and Chief Compliance / AML Officer

By Anitra T. Cassas and Jeffrey M. Hanna

As we have highlighted in prior posts, regulators of financial institutions, including FinCEN, FINRA and SEC, have increasingly brought actions to bring organizations – and individuals – into compliance with AML / BSA obligations.  This enforcement activity is consistent with FinCEN’s August 2014 Advisory, now nearly three years old, emphasizing the idea that U.S. financial institutions… Continue Reading

Compliance, Securities and Commodities

SEC Annual Exam Guidance: Cybersecurity, Robo-Advising, and Retirement

By James C. Freije and Nicholas B. Lewis

The SEC recently announced its Office of Compliance Inspections and Examinations’ (OCIE) 2017 priorities.  Though these listed priorities are not exhaustive and remain flexible in light of market conditions, industry developments, and ongoing risk assessment, it is helpful for companies to keep these items in mind when evaluating securities compliance programs in 2017. The 2017… Continue Reading

Anti-Bribery and Corruption, Compliance, Securities and Commodities

DOJ’s First Corporate Enforcement Action Under Pilot Program

By James C. Freije

In April 2016, the Department of Justice (DOJ) announced its Foreign Corrupt Practices Act Enforcement Plan and Guidance, which includes a one-year pilot program to incentivize individuals and companies to voluntarily self-disclose Foreign Corrupt Practices Act-related (FCPA) misconduct, cooperate with DOJ investigations and remediate controls and compliance programs.  Under the guidance, the DOJ may extend… Continue Reading

Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Securities and Commodities

A Circuit Split is Born. Eleventh Circuit Rules Declaratory Relief and Disgorgement Sought by the SEC Are Subject to 5-Year Statute of Limitations. Injunctive Relief is Not.

By Molly White and McGuireWoods LLP

On May 26th, the Eleventh Circuit held that declaratory relief and disgorgement sought by the SEC are subject to the 5-year statute of limitations under 28 U.S.C. § 2462, but injunctive relief is not.  The court’s holding that § 2462 applies to disgorgement creates two circuit splits:  one with the D.C. Circuit, which has held… Continue Reading

Compliance, Enforcement and Prosecution Policy and Trends, Securities and Commodities

The SDNY Provides Guidance on a Company’s Duty to Disclose Government Investigations

By McGuireWoods LLP

Due to the absence of instructive case law and interpretative guidance from the U.S. Securities and Exchange Commission (SEC), companies are often left in the dark with regard to whether and/or when they should publicly disclose that they are under investigation.  The Southern District of New York recently provided much-needed guidance on the issue. On… Continue Reading

Election and Political Law, Enforcement and Prosecution Policy and Trends, Fraud, Deception and False Claims, Securities and Commodities

AN IMPORTANT CHECK ON THE ABUSE OF GOVERNMENT AUTHORITY

By Nicholas B. Lewis

As citizens of a nation founded on the rule of law, we depend upon law enforcement and prosecutors to protect us from harm and from those who infringe our liberty.  In exchange for this protection, we permit these public servants to exercise authority and at times great power.  Thankfully, and it should go without saying,… Continue Reading

Enforcement and Prosecution Policy and Trends, Fraud, Deception and False Claims, Securities and Commodities

SEC Describes Recent Efforts to Combat Pyramid Schemes and Affinity Frauds

By Michael Baudinet

Over the past two years, the Securities and Exchange Commission (SEC) has stepped up enforcement actions against pyramid schemes and related affinity frauds. Last week, in a speech at the University of Illinois at Chicago, Andrew Ceresney, director of the SEC’s Enforcement Division, addressed his division’s most recent efforts to combat these frauds. In particular,… 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

By McGuireWoods LLP

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

Financial Institution Regulation, Securities and Commodities

FINRA Issues Sweep Letter on Firms’ Cultural Values

By Cheryl Haas, Molly White and McGuireWoods LLP

On February 18, 2016, Financial Industry Regulatory Authority (FINRA) announced that it had issued a targeted exam letter, or sweep, to firms seeking information about how firms establish, communicate and implement cultural values.  FINRA’s stated goal “is to better understand industry practices and determine whether firms are taking reasonable steps to properly establish and implement… Continue Reading

Compliance, Securities and Commodities

PCAOB Adopts Audit Engagement Partner Disclosure

By James C. Freije

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

Securities and Commodities, Uncategorized

Variable Annuities Are Retirement Investment Product of Interest in SEC’s 2016 Examination Priorities

By Cheryl Haas and McGuireWoods LLP

As we discussed yesterday, the Securities and Exchange Commission’s (SEC’s) Office of Compliance Inspections and Examinations (OCIE) released its examination priorities for 2016 on January 11 (the “Examination Priorities”). Retirement investments continue to be an area of focus for OCIE as we march into the new year. Digging deeper into this area, OCIE identified variable… Continue Reading

Compliance, Financial Institution Regulation, Securities and Commodities

SEC Provides Guidance on 2016 Examination Areas of Focus

By James A. Sherman

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

Securities and Commodities

Just Admit It – SEC Requiring Admissions with Increased Frequency

By Louis D. Greenstein and Molly White

As we previously reported, in 2012 and 2013 the Securities and Exchange Commission (SEC) changed its longstanding policy of permitting defendants to settle enforcement actions without admitting or denying liability. Initially, the policy was changed only with regard to settlements involving parallel criminal actions. Subsequently, the policy was further revised to require admissions in certain… Continue Reading

Enforcement and Prosecution Policy and Trends, Fraud, Deception and False Claims, Securities and Commodities

First Guilty Verdict for Dodd-Frank “Spoofing” Violations

By Christopher McEachran

On November 2, 2015, Law360.com reported that Michael Coscia became the first individual to be convicted for the crime of “spoofing” under the Dodd-Frank Act of 2010. The Dodd-Frank Act amended section 4c(a)(5) of the Commodities Exchange Act, making it unlawful to engage in any trading or practice that “is, is of the character of,… Continue Reading

Enforcement and Prosecution Policy and Trends, Securities and Commodities

FY2015 SEC Enforcement Report

By Molly White, Louis D. Greenstein and James C. Freije

Late last week, the Securities and Exchange Commission (SEC) announced its enforcement results for fiscal year 2015, reporting a record number of enforcement actions and the highest amount of fines collected by the SEC to date. Through September 30, the SEC filed 807 enforcement actions − 507 federal securities law violations and 300 delinquent issuers… Continue Reading

Anti-Bribery and Corruption, Securities and Commodities

SEC ‘Broken Windows’ Enforcement Policy Is Showing FCPA Results

By Alex J. Brackett

In October 2013, SEC Chairwoman Mary Jo White announced a broken windows enforcement policy to “pursue even the smallest infractions” of U.S. securities laws, including the FCPA, as a means of deterrence. As White stated in announcing the policy, “minor violations” that a company fails to address “feed bigger ones, and, perhaps more importantly, can… Continue Reading

Compliance, Enforcement and Prosecution Policy and Trends, Financial Institution Regulation, Securities and Commodities

SEC Enforcement Continues to Pursue Hedge Fund Advisers

By Nicholas B. Lewis

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

We use cookies to enhance your experience of our website. By continuing to use this website, you agree to the use of these cookies. For more information and to learn how you can change your cookie settings, please see our policy.

Agree