The Commission created Rule 10b5-1 plans two decades ago. The rule essentially creates a safe haven for those who in good faith trade securities and are not in possession of inside information....more
Things change, at least sometimes. Take Crypto assets. They began as a way to “get off the grid.” Over time some came on to the grid as their popularity increased. Others stayed off....more
12/15/2022
/ Criminal Prosecution ,
Crypto Exchanges ,
Cryptoassets ,
Cryptocurrency ,
Department of Justice (DOJ) ,
Digital Assets ,
Internal Controls ,
Investors ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Trading Platforms
One of the key complaints about the SEC by crypto enthusiasts is that the line between which crypto coins are securities and which are not is unclear. Many, for example, look at a coin and are puzzled – when is it a...more
10/13/2022
/ Advertising ,
Civil Monetary Penalty ,
Consent Decrees ,
Cooperation ,
Cryptoassets ,
Disgorgement ,
Howey ,
Influencers ,
Kim Kardashian ,
Securities ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Tokens ,
Securities Violations ,
Token Sales
Cooperation is frequently touted as the “secret sauce” that can help an issuer or individual facing potentially harsh regulatory scrutiny and sanctions for wrongful conduct mitigate the resolution of the action. Different...more
Earlier this month the Commission approved two new complex financial products. Despite the approval, the new products sparked comments from Chair Gensler and, in a separate but joint statement, Commissioners Allison Herren...more
Crypto currency began with the notion of getting “off the grid” – escaping the regulators and not being regulated. Over time that notion has transmuted. Now platforms trading crypto assets proclaim that the “revolution needs...more
10/18/2019
/ Blockchain ,
CFTC ,
Commodities ,
Cryptocurrency ,
Digital Assets ,
Distributed Ledger Technology (DLT) ,
FinCEN ,
Investment Contract ,
Registration Requirement ,
Regulatory Oversight ,
Securities Act of 1933 ,
Securities Violations ,
Unregistered Securities ,
Virtual Currency
Crypto currency has been all the fashion. Most proponents that have been confronted by a regulator – the SEC or CFTC generally – have quickly resolved the matter. Few have tried to litigate with the agencies and those who...more
2/22/2019
/ Cryptocurrency ,
Discovery ,
Enforcement Actions ,
Howey ,
Initial Coin Offering (ICOs) ,
Motion for Reconsideration ,
Preliminary Injunctions ,
Rule 11 ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Unregistered Securities
“The distinction between primary and secondary liability matters...For decades...the SEC has tried to erase that distinction...” Lorenzo v. SEC, 872 F. 3d 578, 601 (D.C. Cir. 2017) (Kavenaugh, Circuit Judge,...more
6/22/2018
/ Burden of Proof ,
Certiorari ,
Class Action ,
Enforcement Actions ,
Petition for Writ of Certiorari ,
Premises Liability ,
SCOTUS ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Fraud ,
Securities Litigation
Financial fraud has long been a staple of SEC enforcement. In the wake of the market crisis the agency has attempted to once again focus on the area creating, for example, a financial fraud task force two years ago. Last...more
Sometimes is does not pay to be the last man standing – particularly in a Commission enforcement action. Such was the fate of former NFL player and Olympic athlete Willie Gault. SEC v. Heart Tronics, Inc., Case No....more
The Commission brought another in a series of actions centered on ConvergEx Execution Solutions LLC and its affiliates. As with the prior actions, this one centered on secretly adding substantial commissions to transactions...more
A former Texas Attorney General and state representative combined with others at a computer firm to promote the shares of the company which claimed to compete with Dell, Apple and others. About $26 million in stock was sold...more
In recent years the SEC has brought a series of investment and offering fraud actions. Typically those actions center on schemes which promise to-good-to-be-true returns in which investors lose substantial sums. In what may...more
Pump- and-dump schemes keyed to microcap stocks seem to be the flavor of the week. On Friday the mastermind of an international market manipulation scheme was sentenced to serve 18 years in prison. U.S. v. Gallison,...more
Municipal bond offerings have become a key focus of SEC Enforcement. The agency has brought a series of actions in addition to an initiative that encourages the self-reporting of underwriters in return for reduced sanctions....more
3/9/2016
/ Broker-Dealer ,
Commercial Bankruptcy ,
Enforcement Actions ,
Liquidation ,
Municipal Bonds ,
Municipal Securities Issuers ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Self-Reporting ,
Underwriting ,
Wells Fargo
The Commission filed two administrative proceedings this week. One centers on false entries made in the books and records of a broker dealer. It will be set for hearing. In the Matter of Jason Maiher, Adm. Proc. File No....more
The Commission has brought a series of cases where investors lost substantial sums purchasing shares of firms whose operations and or assets were supposedly largely in China. In some instances the firms turned out not to have...more
The Commission has been tried to make accounting and financial fraud issues a key focus at least since the creation of the financial fraud task force two years ago. Last week the agency brought an action against Monsanto...more
The SEC prevailed on two summary judgment motions. One centered on a manipulation action. The other was against an attorney who facilitated a prime bank fraud.
The Commission also filed: An action against UBS tied to its...more
10/16/2015
/ Administrative Proceedings ,
Australia ,
Bank Fraud ,
Board of Directors ,
Broker-Dealer ,
Cease and Desist Orders ,
Corporate Governance ,
Crisis Management ,
Disclosure Requirements ,
Disgorgement ,
Enforcement Actions ,
Fraud ,
Hong Kong ,
Insider Trading ,
Investment Advisers Act of 1940 ,
Investment Funds ,
Market Manipulation ,
Misappropriation ,
Misrepresentation ,
PCAOB ,
Penalties ,
Permanent Injunctions ,
Pump and Dump ,
Registered Investment Advisors ,
Risk Management ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Fraud ,
Securities Litigation ,
Serious Fraud Office (SFO) ,
Shareholders ,
UK
A recurrent theme in today’s enforcement environment is parallel and often overlapping proceedings. That is the case with a District of Columbia based broker that drew sanctions from the SEC, FINRA and DC. In the Matter of...more
8/17/2015
/ Broker-Dealer ,
Cease and Desist ,
Civil Monetary Penalty ,
Department of Insurance ,
Enforcement Actions ,
Financial Industry Regulatory Authority (FINRA) ,
Misrepresentation ,
Promissory Notes ,
Restitution ,
Sanctions ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act
Dark pools are one of the issues which have been debated at least since Michael Lewis published Flash Boys and Scott Patterson put out Dark Pools. To date the SEC has brought two actions involving the trading venues. One was...more
8/13/2015
/ Algorithmic Trading ,
Alternative Trading System (ATS) ,
Broker-Dealer ,
Civil Monetary Penalty ,
Confidential Information ,
Dark Pool ,
Enforcement Actions ,
Prejudgment Interest ,
Proprietary Information ,
Proprietary Trading ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC)
Microcap fraud has been a priority of SEC Enforcement since at least the formation of the Microcap Task Force about two years ago. The Commission has brought a series of cases focused largely on pump-and-dump schemes....more
The market crisis of the last decade seems to have a never ending dribble of cases. The SEC filed another this week, naming four former officers of Wilmington Trust Company as defendants. SEC v. Gibson (D.Del. Filed May 6,...more
A staple of SEC enforcement in recent years has been offering fraud and Ponzi scheme cases. This week the Commission filed two more of these actions, one an offering fraud targeting military personnel and a second and...more
The Commission filed another offering fraud action tied to the sale of interests in the development of oil and gas wells prior to the recent downturn in the price of oil. Beginning in 2010 the defendants raised about $4.4...more