The U.S. Securities and Exchange Commission’s (“Commission” or “SEC”) whistleblower program has, by all accounts, been a huge success. Added to the Securities Exchange Act of 1934 (“Exchange Act”) as Section 21F by the...more
Traditionally the jurisdiction of the CFTC has been tied to the futures markets. Contracts for future delivery were within the reach of the agency and its regulatory regime....more
The SEC’s position on the scope of the whistleblower protections in Dodd-Frank was rejected by the Supreme Court. In Digital Realty Trust, Inc., v. Somers, No. 16-1276 (Feb. 21, 2018) the Court concluded that the SEC’s...more
The SEC filed its first action against a municipal adviser for breach of fiduciary duty based on a provision amended by Dodd-Frank. The agency also continued to file insider trading actions in an administrative forum....more
3/18/2016
/ Administrative Proceedings ,
Auditors ,
Australia ,
Breach of Duty ,
CFTC ,
Conflicts of Interest ,
Dodd-Frank ,
Enforcement Actions ,
Fiduciary Duty ,
Hong Kong ,
Insider Trading ,
Investment Fraud ,
Municipal Advisers ,
Offering Fraud ,
PCAOB ,
Rebates ,
Securities and Exchange Commission (SEC) ,
Supply Chain ,
UK ,
Unregistered Brokers
The Commission brought its first action based on Exchange Act Section 15B(c)(1) as amended by Section 275 of Dodd-Frank. Under that provision municipal advisors and their associated persons have a fiduciary duty to their...more
Suits challenging the SEC’s forum selection decisions continue to proliferate. As the trend has unfolded the Commission posted a memo on its website discussing the issue of forum selection and has proposed modifications to...more
10/5/2015
/ Administrative Hearings ,
Administrative Law Judge (ALJ) ,
Administrative Procedure Act ,
Bebo v SEC ,
Chevron Deference ,
Dismissals ,
Dodd-Frank ,
Due Process ,
Enforcement Actions ,
Equal Protection ,
Fifth Amendment ,
Forum Selection ,
Investment Adviser ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act
The SEC’s interpretation of the Dodd-Frank whistleblower provisions prevailed in a recent Second Circuit decision, creating a circuit split that could be heading for the Supreme Court. Specifically, the Circuit Court deferred...more
9/14/2015
/ Accounting Fraud ,
Appeals ,
Dodd-Frank ,
Financial Reporting ,
Motion to Dismiss ,
Reporting Requirements ,
Retaliation ,
Reversal ,
Sarbanes-Oxley ,
Securities and Exchange Commission (SEC) ,
Statute of Limitations ,
Whistleblower Protection Policies
The Dodd-Frank Wall Street Reform Act imposed a requirement on the SEC in Section 1504 to promulgate a disclosure rule regarding certain extraction payments involving resource issuers within 270 days of passage or by April...more
9/8/2015
/ Administrative Procedure Act ,
American Petroleum Institute ,
Disclosure Requirements ,
Dodd-Frank ,
Injunctions ,
Mineral Extraction ,
Multi-Factor Test ,
Oil & Gas ,
Resource Extraction ,
Rulemaking Process ,
Securities and Exchange Commission (SEC)
The Sixth Circuit last week concluded that Morrison, which held that Section 10(b) does not have extraterritorial reach, is inapplicable to Advisers Act Section 10(b). The DC Circuit, on rehearing, reaffirmed its prior...more
8/28/2015
/ Appeals ,
Charles Schwab ,
Conflict Mineral Rules ,
Disclosure Requirements ,
Dodd-Frank ,
EB-5 ,
Enforcement Actions ,
Extraterritoriality Rules ,
False Statements ,
Financial Industry Regulatory Authority (FINRA) ,
First Amendment ,
Fraud ,
Insider Trading ,
Investment Adviser ,
Misappropriation ,
NAM ,
NAM v SEC ,
Net Capital Rule ,
Offering Fraud ,
Securities and Exchange Commission (SEC)
The SEC’s conflict mineral disclosure rule, enacted under Dodd-Frank, is a continuing source of controversy. An initial challenge to the rules was brought by the National Association of Manufactures. That challenge was...more
SEC Commissioner Daniel Gallagher provided something of a score card for activities over the past five years he has served on the agency prior to his impending departure. To the surprise of few he panned the Dodd-Frank and...more
When does a 180 day deadline not mean that in 180 days time is up? Answer: When the SEC says so and the DC Circuit gives the conclusion Chevron deference. That is the holding of Montford and Company, Inc. v. SEC, No. 14-1126...more
Two entrepreneurs wanted to create a business that centered on valuing private start-up companies. They experimented with models that began with a variation of “fantasy sports,” changed to a contest and became a game. It...more
This week Senator Elizabeth Warren forwarded a 13 page letter to SEC Chair White regarding her performance in office. The letter highlighted what it calls a “significant gap” between the promises of Ms. White at the time she...more
6/6/2015
/ CFTC ,
Dodd-Frank ,
Fraud ,
Hong Kong ,
Insider Trading ,
Investment Funds ,
Market Manipulation ,
Mary Jo White ,
Misappropriation ,
Misrepresentation ,
Offering Fraud ,
Securities and Exchange Commission (SEC) ,
Serious Fraud Office (SFO) ,
UK
The SEC Speaks conference has traditionally been a forum in which the agency reviewed significant recent undertakings and indicated its future direction. This year was no different. Four of the five Commissioners addressed...more
The Commission recently filed an amicus brief defending its Dodd-Frank whistleblower rules. Those rules specify that the anti-retaliation provisions of those amendments to the Exchange Act protect those who chose not to...more
2/20/2015
/ Anti-Retaliation Provisions ,
Bid Rigging ,
Bitcoin ,
Dodd-Frank ,
Insider Trading ,
Investment Adviser ,
Investment Funds ,
Misappropriation ,
Municipal Securities Market ,
Oppenheimer & Co. ,
Pyramid Schemes ,
Securities and Exchange Commission (SEC) ,
Whistleblowers
A critical component of the SEC’s whistleblower program is the anti-retaliatory provisions of Exchange Act Section 21F, added to the statute by the Dodd-Frank Act. To implement that provision the Commission promulgated two...more
The SEC was granted authority in the Dodd-Frank Act to initiate administrative proceedings against non-regulated persons. In those proceedings the full range of remedies are available – a cease-and-desist order, disgorgement,...more
The Commission filed another settled FCPA action this week. The proceeding named two U.S. citizens living abroad as Respondents. The DOJ issued an Opinion discussing successor liability....more
11/21/2014
/ Administrative Review Board ,
Australia ,
Conflict Mineral Rules ,
Cybersecurity ,
Department of Justice (DOJ) ,
Dodd-Frank ,
Ebola ,
Enforcement Actions ,
Financial Regulatory Reform ,
First Amendment ,
Foreign Corrupt Practices Act (FCPA) ,
Injunctions ,
Insider Trading ,
Misappropriation ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Settlement ,
Successor Liability ,
UK
Rengan Rajaratnam settled his insider trading case with the SEC this week, consenting to the entry of a permanent injunction and agreeing to pay disgorgement, prejudgment interest, a civil penalty and to be barred from the...more
10/24/2014
/ Breach of Duty ,
Civil Monetary Penalty ,
Disgorgement ,
Dodd-Frank ,
Enforcement Actions ,
Federal Reserve ,
Financial Industry Regulatory Authority (FINRA) ,
Hong Kong ,
Insider Trading ,
Investment Funds ,
Misappropriation ,
PCAOB ,
Permanent Injunctions ,
Prejudgment Interest ,
Rulemaking Process ,
Securities and Exchange Commission (SEC) ,
Securities Fraud
The Commission prevailed in three litigated decisions. The agency secured a favorable jury verdict in an action centered on an offering fraud. In two other cases — one based on misrepresentations regarding the only company...more
10/17/2014
/ Australia ,
Broken Windows ,
Broker-Dealer ,
CFTC ,
Criminal Prosecution ,
Cross-Border ,
Dodd-Frank ,
Enforcement Actions ,
High Frequency Trading ,
Hong Kong ,
Insider Trading ,
International Harmonization ,
Investment Funds ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Settlement
The Commission brought its first pay-to-play action involving political campaign contributions under the Investment Advisers Act. The proceeding is predicated on the integration of two firms which claimed to be exempt from...more
The Commission brought its first action involving the anti-retaliation provisions of the Dodd-Frank Act. It centers on an investment adviser, a broker dealer, conflicts and retaliation against a firm employee who reported the...more
The SEC largely prevailed in the D.C. Circuit Court of Appeals in a suit changing the Rules promulgated by the agency under Dodd-Frank regarding conflict minerals. National Association of Manufacturers v. SEC, No.. 13-5252...more
The Commission prevailed after a two week jury trial in an insider trading case this week, ending a string of losses. The agency also filed two settled actions, one based on insider trading claims and another involving...more
2/14/2014
/ Australia ,
Dodd-Frank ,
Financial Industry Regulatory Authority (FINRA) ,
Foreign Corrupt Practices Act (FCPA) ,
Hong Kong ,
Insider Trading ,
Investment Adviser ,
Investment Fraud ,
Misappropriation ,
Ponzi Scheme ,
Securities and Exchange Commission (SEC) ,
Securities Litigation ,
Volcker Rule