Securities Fraud Securities & Exchange Commission

News & Analysis as of

SEC Charges Adviser With Fraud Tied to “Death Puts”

The Commission’s enforcement division and inspectors at OCIE continue to work closely and have developed a series of cases in recent months. One of the more unusual proceeding spawned through this relationship is the action...more

Private Company Employee Stock Sales Highlight Hidden Dangers of Compliance Failures

We noted with interest the latest moves by some Bay Area tech giants to permit their employees to sell restricted stock to help them realize the stock value as part of their compensation: See New York Times reporting here. ...more

DC Circuit Upholds SEC ALJs in First Merits Opinion

The D.C. Circuit has affirmed that SEC ALJs are not constitutional Officers subject to the Appointments Clause, rejecting perhaps the strongest of the constitutional challenges to the Commission’s administrative forum. The...more

SEC Files Another Excessive Fee Case

The Commission brought another in a series of civil and criminal actions centered on charging excessive, undisclosed fees to clients transitioning their portfolios. SEC v. Place, Civil Action No. 2:16-c-4291 (E.D.Pa. Filed...more

The SEC Audit Trail – Several Industry Groups See Problems as Currently Proposed

Last week, several securities industry groups filed critical responses to the SEC’s plan for an audit trail. While most groups that commented on the SEC’s proposed regulation supported implementing the proposal, several had...more

A Ponzi Scheme Where One Investor Directly Paid Another

In the typical Ponzi scheme unscrupulous individuals induce investors to part with their cash based on a series of misrepresentations about the proposed investment. The investor money is then in part misappropriated and in...more

Lowndes Attorneys Obtain Favorable Rulings for Court-Appointed Receiver

Orlando, FL–Lowndes, Drosdick, Doster, Kantor & Reed, P.A. is pleased to announce that shareholder, Richard Dellinger, and appellate attorney, Jennifer R. Dixon, prevailed in defending a client appointed to serve as a...more

When is a Joint Venture a Security?

Parvizian controlled Arcturus and Aschere, buying and selling interests in drilling projects. Each project had a managing venturor which supervised the project. Each venture included a confidential information memorandum,...more

The Scope Of SEC Defendants' Jury Trial Right: Part 3

This is the third of four articles examining the scope of the Seventh Amendment jury trial right for civil defendants in U.S. Securities and Exchange Commission enforcement actions. Our first article explained why the Seventh...more

Your daily dose of financial news - The Brief – 7.19.16

The Carlyle Group is staring down the barrel of a $1 billion civil lawsuit by the failed Carlyle Capital Corp.’s liquidators over the 2008 collapse of the mortgage-bond fund. The trial’s taking place in Guernsey, a British...more

Your daily dose of financial news - The Brief – 7.18.16

William Ackman’s multi-year effort to expose Herbalife as a Ponzi scheme (and make good on his massive short of its stock) saw something of a moral victory last week, with the FTC imposing big-time sanctions ($200 million in...more

US IPO Guide 2016 Edition

This is our initial public offering guide. It will help you decide whether an IPO is the right move for your company and, if so, help you make sure your IPO goes off as quickly and as smoothly as possible, without any...more

Your daily dose of financial news - The Brief – 7.11.16

A putative class action filed last week is accusing 25 prominent banks—including Deutsche Bank, Goldman Sachs, and Barclays—of “conspiring to rig the market for securities” sold by the US Treasury in their roles as primary...more

Investment Management Update

SEC Enforcement Action against Private Equity Fund Adviser - On June 1, 2016, the SEC announced that a private equity fund adviser and its principal owner agreed to pay more than $3.1 million to settle SEC charges that,...more

This Week In Securities Litigation

Just prior to the July 4th holiday a legend of the federal securities bar passed away. Irving Pollock, or Irv as he was known, was the father of the SEC’s Enforcement Division. A New Mexico jury handed the Commission a...more

Wall Street Executive Pleads Guilty In Investment Fraud

Andrew Caspersen, a former managing principal of Blackstone Group, and a partner at Park Hill Group which raises capital for private equity, pleaded guilty to one count of securities fraud and one count of wire fraud. U.S. v....more

Equity Trust Notches a Rare Defense Win in SEC Administrative Proceedings

On June 27, 2016, SEC Administrative Law Judge Carol Fox Foelak dismissed the Division of Enforcement’s charges against IRA custodian Equity Trust Company in connection with the company’s processing of investments marketed by...more

Jury Rejects SEC’s Key Claims While Deadlocking on Others

A jury rejected most counts brought by the SEC against two senior executives of Thornburg Mortgage, Inc., the second largest independent mortgage company in the country. The charges centered on a market crisis era scheme in...more

Left Swinging: Why Mickelson Went Uncharged For Insider Trading

In Depth - The Securities and Exchange Commission recently revealed details of an insider trading case against a gambler named William Walters, who allegedly engaged in insider trading based on information he obtained...more

Whistleblowers: No Reasonable Belief of Violation, No Protection

The SEC has been touting the large cash awards it has been handing out to whistleblowers. The agency views whistleblowers as a key source of potential information about wrong-doing which can give them tips and facilitate...more

Your daily dose of financial news - The Brief – 6.14.16

The big story of week so far came just a few minutes after the Brief went to [digital] print yesterday, so apologies for the second hand news: Microsoft has agreed to acquire LinkedIn for a staggering $26.2 billion in a move...more

Eleventh Circuit Applies Five-Year Statute of Limitations to SEC Disgorgement Claims

On May 26, the Eleventh Circuit Court of Appeals unanimously ruled that the five-year statute of limitations applicable to Securities and Exchange Commission claims for fines and suspensions or bars also applies to SEC claims...more

Orrick's Financial Industry Week in Review

Council of EU Adopts Regulation Extending Exemptions for Commodity Dealers under CRR - On May 30, 2016, the Council of the EU published a press release confirming that it has adopted a Regulation amending the Capital...more

Republicans Announce Plans to Replace Dodd-Frank

House Financial Services Committee Chairman Jeb Hensarling (R-TX) unveiled details of the Financial CHOICE Act – the Republican plan to replace the Dodd-Frank Act and promote economic growth. CHOICE stands for Creating Hope...more

A Compilation of Non-Enforcement and Enforcement Actions

Non-Enforcement - Mutual Fund Directors Must Be Vigilant in Addressing Risks - In remarks to the Mutual Fund Directors Forum, SEC Chair Mary Jo White outlined some of the risks and challenges that mutual fund...more

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