News & Analysis as of

Unregistered Brokers

SEC Files Another Unregistered Broker Action Tied to EB-5

by Dorsey & Whitney LLP on

The Commission has brought a series of unregistered broker actions in recent years – the cases have become a staple of Enforcement. One of the areas which seems to generate a continuing series of these cases is the EB-5...more

Just Who Are A Corporation's "Regular Officers"?

by Allen Matkins on

California declares it unlawful for any person to engage in the business of, act in the capacity of, advertise as, or assume to act as a real estate broker or a real estate salesperson within California without first...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

The Commission had one win and two losses in court over the last week, one of which may have a long term impact on its cases. In a case centered on two alleged microcap manipulations the court dismissed the complaint finding...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

A new report by Cornerstone Research and the NYU Pollack Center shows a significant drop in the number of SEC enforcement cases in the second half of the last Government fiscal year, attributable to the change in...more

SEC Claims Individual, Firm Engaged In Unregistered Dealer Business

by Dorsey & Whitney LLP on

The Commission’s recently released report on the Enforcement Division identified retail investors and cyber as key areas of emphasis for Enforcement under Chairman Clayton. Examples of the retail focus are actions involving...more

With Zenefits Settlement Award SEC Demonstrates Continued Commitment to “Unicorn” Scrutiny Despite Administration Change: Same Old...

Last week the SEC announced it had reached an agreement with privately-held company Zenefits, and its co-founder and former CEO Parker Conrad, to settle allegations that Zenefits materially misled Series B and C investors....more

SEC and U.S. Attorney’s Office Bring Action Against Promoter of Bitcoin Store, Inc.

by Perkins Coie on

On June 30, 2017, the SEC and the U.S. Attorney brought parallel civil and criminal fraud charges against Renwick Haddow, the owner of an unregistered broker-dealer entity named InCrowd Equity Inc., and two corporate entities...more

Jury Rejects SEC Market Crisis Fraud Claims Against Bank, CEO

by Dorsey & Whitney LLP on

Last week the SEC prevailed on a partial motion for summary judgment, obtaining a ruling that certain individuals involved in an offering fraud acted as unregistered broker dealers. This week, the Commission lost a long...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

The nomination of Jay Clayton as the next SEC Chairman moved forward in the Senate this week. The Senate Banking Committee approved Mr. Clayton by a vote of 15 to 8 with three Democrats joining the Republicans in the...more

SEC Charges Trading Firm's Education Program Violates Broker Registration Section

by Dorsey & Whitney LLP on

Commission enforcement actions have focused on Exchange Act Section 15(a) and its prohibition on acting as a broker without registering with the agency in recent months. The Exchange Act defines a broker as any person...more

The Danger of Paying Finder’s Fees to Unregistered Broker-Dealers

by Dorsey & Whitney LLP on

We get asked from time-to-time whether it is advisable for issuers to pay fees to unregistered “finders” for introducing potential investors in the United States to the issuer in connection with securities offerings. The...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

NERA issued a report this week on Canadian class actions. Although the number of those actions filed last year increased compared to the year before, over the last several years the number of securities class actions filed in...more

Unregistered Sales Of Certificates Of Deposit

by Allen Matkins on

Last spring, the California Department of Business Oversight warned consumers that two related companies have been offering unlicensed online securities broker-dealer services and “unregistered sales of certificates of...more

New FINRA Capital Acquisition Broker Rules May Offer Limited Relief to Private Investment Fund Advisers

by Jackson Walker on

The U.S. Securities and Exchange Commission (“SEC”) recently approved a Financial Industry Regulatory Authority (“FINRA”) proposal to adopt a new regime for the regulation of electing broker-dealer firms that meet the...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

The Commission brought actions this week centered on the failure to properly conduct audits, an offering fraud and for acting as an unregistered broker. FINRA sanctioned eight firms for failing to adequately supervise the...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

The Commission, along with the DOJ, filed a settled FCPA action against aircraft manufacturer Embraer. The action centered on bribes paid in multiple countries to facilitate the sale of aircraft....more

Bridging the Week - October 2016 #3

by Katten Muchin Rosenman LLP on

Registration Based on Quantitative Test Likely to Be Part of Supplemental Regulation AT, Suggests CFTC Chairman - Timothy Massad, Chairman of the Commodity Futures Trading Commission, indicated last week that he...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

The Commission filed another action in which admissions were required as part of the settlement. The proceeding named as Respondents a foreign bank and two of subsidiaries. Respondents variously acted as unregistered brokers...more

Fantasy Stock Picking Contest Deemed by SEC to be Illegal Security-based Swaps

The SEC shut down a “fantasy” stock picking game for allegedly violating securities laws. Forcerank LLC ran contests via mobile phone games where players paid a fee and predicted the order in which 10 securities would perform...more

Bridging the Week - September 2016 #4

Ex-Airline Employee Sued by CFTC for Insider Trading of Futures Based on Misappropriated Information: The Commodity Futures Trading Commission brought and settled charges against Jon Ruggles, a former trader for Delta...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

Numbers were the focus this week as the Commission filed 81 administrative proceedings (must be near fiscal year end) and two civil injunctive actions. Seventy-one of the actions involved municipal issuers who self-reported...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

The SEC prevailed on summary judgment in an action centered on an offering fraud. The principals of the scheme were found to have violated the antifraud provisions while a codefendant was determined to have acted as an...more

Additional Regulatory Hurdles for Private Equity Advisers

by McCarter & English, LLP on

The private equity industry should carefully consider the implications of a recent Securities and Exchange Commission ("SEC") enforcement action. In it, the SEC, for the first time, sanctioned an SEC-registered private equity...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

In the week leading up to the July 4th holiday weekend the SEC filed an action alleging insider trading centered on the acquisition of a firm by Apple based largely on circumstantial evidence and outsized trading. Another...more

This Week In Securities Litigation

by Dorsey & Whitney LLP on

Merrill Lynch was at the center of actions brought by the SEC and FINRA this week. One action charged the firm with violations of the customer protection rule tied to using customer cash and failing to protect their...more

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Cybersecurity

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