David Smyth

David Smyth

Brooks Pierce

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It Starts with the Custody Rule

If you’re an investment adviser with custody of your client’s assets, is there a more important rule to be sure you’re on top of than the custody rule? If you’re on the SEC’s IA exam staff, is there a more important rule to...more

5/13/2014 - Compliance Custody Rule Fraud SEC

SEC Charges Hao He with Insider Trading, for Some Reason or Another

Here are two things about insider trading law: First, it’s hard to know exactly what the parameters are. The United States doesn’t have a specific statute prohibiting it. It grows out of the general anti-fraud provisions...more

2/10/2014 - Fraud Insider Trading SEC Securities Act of 1933 Securities Exchange Act

Prosecutors Trying to Get Martoma Wackiness into Evidence By Hook or by Crook

So I’m at my desk the other day, minding my own business, when I read on the Twitter, “Ex-SAC Trader Expelled from Harvard Law School” or some such. The article explained the 1999 expulsion of Mathew Martoma, who is...more

1/16/2014 - Evidence Fraud Insider Trading Rule 404(b) Rule 608

“The World’s Largest Ponzi Scheme”

Regarding my last post on whistleblowers and tipsters at the SEC, I wanted to make one more related point. Many people like to yell at the SEC for not grasping the gravity of Harry Markopolos’s complaints about Bernie...more

1/15/2014 - Bernie Madoff Fraud Ponzi Scheme SEC Whistleblowers

SEC CustodyFest Vol. 1: A New Beginning

Imagine being Andrew Bowden. As director of the SEC’s Office of Compliance, Inspections and Examinations, you know you don’t have enough staff to conduct reasonably regular exams of registered investment advisers. You also...more

11/12/2013 - Books & Records Custody Rule Customer Funds Protection Fraud Investment Adviser SEC

SEC Sues McGinn Smith Gatekeepers

If you’re the SEC’s Enforcement Division, suing primary violators is one thing. Bring cases against “gatekeepers”, or professionals who allow access to securities markets, can be quite another. Theories of liability are not...more

10/23/2013 - Enforcement Actions Fraud SEC

SEC Takes Oddly Aggressive Stance on Payment of Monetary Sanctions

When Mary Jo White was installed as the SEC’s chair in April, I had little doubt she would be well-suited for her new role. She is extremely well regarded in the securities bar, and doubts about “ties to Wall Street”...more

8/28/2013 - Fraud Mary Jo White Penalties Sanctions SEC

Three Thoughts about Steve Cohen’s Failure-to-Supervise Case

Stanley Sporkin — former SEC Enforcement Director, CIA general counsel, and federal judge – likes to say that an SEC staff attorney ought to be just as happy closing an investigation as one is bringing a public enforcement...more

7/26/2013 - Administrative Hearings Fraud Insider Trading Negligent Supervision Rule 10b-5 Sanctions SEC Steve Cohen Supervision White Collar Crimes

Financial Fraud Specialists at the SEC

We live in a world where people do not always do what I wish they would do. I imagine you’re probably okay with that; I’m coming to terms with it. But here is an example of something I think should happen that probably won’t:...more

6/26/2013 - Enforcement Actions Fraud GAAP PACCAR Inc SEC Specialization

SEC Buys Itself a Headache

If you’re reading this, you’re surely aware of the several-years-old-now fight between the SEC and some federal judges regarding the SEC’s policy of settling cases while allowing defendants to neither admit nor deny the...more

6/20/2013 - Fraud Mary Jo White Neither Admit Nor Deny Settlements SEC Settlement

Lenny Dykstra Is Open for Business!

On Dealbreaker last week, Bess Levin hilariously reported former baseball player Lenny Dykstra’s release from a California prison after his guilty plea and sentencing for three felony counts – bankruptcy fraud, concealment of...more

6/19/2013 - Athletes Criminal Prosecution FINRA Fraud Fraudulent Concealment Money Laundering SEC

SEC Considers Returning to Its Roots

The SEC has recently taken a well-deserved beating for its lack of attention to financial fraud at publicly traded companies. The numbers speak for themselves. In 2012, the SEC brought 79 financial fraud cases, when in years...more

6/17/2013 - Enforcement Actions Fraud GAAP Publicly-Traded Companies SEC

Total S.A. FCPA Actions Hearken Back to Time of Tupac Shakur, Beepers

Remember 1995? It was a long time ago, so you can be forgiven for not recalling much of it. To re-orient you: it was President Clinton’s first term; the Oklahoma City bombing happened in April; a jury found O.J. Simpson not...more

5/31/2013 - Bribery FCPA Fraud Fraudulent Concealment Gabelli v SEC Sanctions SEC Statute of Limitations Total SA

SEC Brings Case Involving EB-5 Investment Program

It’s not often that the securities enforcement and immigration law worlds collide, but I suppose it occasionally happens....more

2/11/2013 - EB-5 Foreign Investment Fraud Immigrant Investment Visas SEC USCIS Visas

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