Subject to Inquiry

Subject to Inquiry


Government Investigations and White Collar Litigation Group
Securities and Commodities

FINRA Enforcement Previews Initial CAT Enforcement Philosophy

On May 18, 2023, during an “Ask FINRA Senior Staff” panel held as part of FINRA’s 2023 Annual Conference, Christopher Kelly, Acting Head of FINRA Enforcement, provided a first look into how FINRA Enforcement intends to address CAT reporting violations as the industry nears the three-year anniversary of the first Phase of CAT go-live and ahead of any published enforcement activity to date.

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Securities and Commodities

Update on FINRA’s Use of CAT Data – They Are “Just Scratching the Surface”

During FINRA’s 2023 Annual Conference held on May 16-18, 2023, several panels provided insight into how FINRA is currently using CAT data for market surveillance and how FINRA plans to use the data going forward to both develop more sophisticated surveillance reviews and further promote industry-wide efficiencies. 

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Securities and Commodities

FINRA Continues to Prioritize Compliance with CAT Reporting

On May 17, 2023, as part of FINRA’s 2023 Annual Conference, staff from FINRA’s Market Regulation and Member Supervision Departments, along with representatives from FINRA CAT, participated in a panel entitled “Consolidated Audit Trail (CAT): What You Need to Know.”[1] 

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Energy Enforcement

McGuireWoods Releases Update to One-of-a-Kind FERC Enforcement Reporter

Over the past year, there have been major Federal Energy Regulatory Commission developments as more cases moved from the agency to adjudication in the courts. McGuireWoods’ update to its innovative FERC Enforcement Reporter — led by lawyers Carrie Mobley and Corban Coffman — organizes energy enforcement cases from 2005 to present by topic and presents the information in an easy-to-use index format.

The FERC Enforcement Reporter, a web-based tool, consists of an alphabetical index of key terms with citations to cases in which FERC discussed or applied the term in a significant way. McGuireWoods partners Todd Mullins and Noel Symons created the reporter in 2015.

Users can sign up for access to the FERC Enforcement Reporter.

Fraud, Deception and False Claims

Ophthalmic Distributor May Face $848M in Penalties for Kickbacks, False Claims Act Violations

On Feb. 28, a federal jury in the District of Minnesota found the Cameron-Ehlen Group, d/b/a Precision Lens, and its founder and owner guilty of paying kickbacks to ophthalmic surgeons in violation of the False Claims Act and Federal Anti-Kickback Statute between 2006 and 2015.

Read on for details about this case, which illustrates the risks medical device manufacturers and distributors can incur without an effective compliance program.

Enforcement and Prosecution Policy and Trends

U.S. Department of Education Launches Secret Shoppers Program to Investigate Colleges and Universities

Federal Student Aid’s Office of Enforcement announced a “secret shoppers” program to evaluate a college or university’s recruitment, enrollment, financial aid and other practices. The secret shoppers program will focus on student recruitment and enrollment practices, which may include the practices of online program managers.

Read on for details about this initiative, including types of practices that present red flags, and recommended next steps for colleges and universities.

Financial Institution Regulation

Silvergate, Silicon Valley Bank, Bank Receiverships in General, and Payroll Regulatory Challenges

In the wake of Silvergate’s collapse, Silicon Valley Bank entering receivership and another bank following in SVB’s footsteps, startups and other companies directly affected by these events are struggling to manage their payroll and other obligations while credit facilities are frozen. Although depositors likely will be fully protected and most businesses can expect to avoid the brunt of this banking crisis, some employers still may face tough decisions.

Read on to learn about state and federal law considerations and recommended next steps for employers.

Anti-Bribery and Corruption

Ericsson Pleads Guilty, Agrees to Pay $206M in Fines, Following Alleged Violation of FCPA Deferred Prosecution Agreement

Last week, the U.S. Department of Justice (DOJ) announced that Sweden-based multinational telecommunications company Telefonaktiebolaget LM Ericsson (Ericsson) will plead guilty to breaching the Foreign Corrupt Practices Act (FCPA) and has agreed to pay over $206 million in related penalties following its alleged breach of a 2019 Deferred Prosecution Agreement (DPA) with the Department.

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Enforcement and Prosecution Policy and Trends

DOJ Announces “Pilot Program Regarding Compensation Incentives and Clawbacks” with Significant Ramifications for Corporations Facing Criminal Investigations

The Department of Justice Criminal Division announced a “Pilot Program Regarding Compensation Incentives and Clawbacks” (the “Program”) this week with broad implications for corporations and their individual executives operating within the Department’s jurisdiction. During two keynote speeches delivered at the American Bar Association’s National Institute on White Collar Crime, Deputy Attorney General Lisa Monaco (remarks here) and Assistant Attorney General Kenneth A. Polite, Jr. (remarks here), outlined the Program’s two key pillars.  First, moving forward, any corporate resolution with the Department’s Criminal Division must include a requirement that the company develop compliance-promoting criteria within its compensation and bonus system.  Second, Criminal Division prosecutors are instructed to provide fine reductions to companies who either successfully claw back compensation from corporate wrongdoers or undertake good-faith efforts to do so.

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Sanctions, Trade Embargo, and Export Controls

U.S. Department of Justice and Partners Increasing Enforcement of Sanctions and Export Controls

It has been a little more than a year since Russia’s invasion of Ukraine, and the war continues to rage.  In an effort to deter the Russian government and weaken its military capabilities, the United States has imposed significant sanctions and export controls targeting Russia.  Recognizing that these sanctions and export control laws merit aggressive enforcement, the U.S. Department of Justice (DOJ) over the past year has made investigation and prosecution of violations a priority.

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