LexisNexis® Legal Newsroom
The Week In Securities Litigation: FCPA A Focus, SEC Prevails In Court

The FCPA continued to be a focus this week. Another Alstrom executive was added to a pending criminal prosecution in a superseding indictment charging FCPA violations and money laundering. In court the Commission prevailed in the D.C. Circuit as well as the district court. In the Circuit Court the...

SEC Reaches Settlement With Pennsylvania City Over Federal Securities Law Violations

WASHINGTON, D.C. - (Mealey's) The Securities and Exchange Commission and the City of Harrisburg, Pa., have agreed to a cease-and-desist order preventing the city from continuing its violation of federal securities laws in connection with statements it made both publicly and in financial documents...

The Week In Securities Litigation: SEC Seeks Budget Hike, Brings 2 New Actions

The focus this week was on the proposed SEC budget as new SEC Chair Mary Jo White told a House subcommittee that the agency needs about a 26% increase. Part of the additional funding is to hire almost 700 new staff members. SEC enforcement, in conjunction with the Manhattan U. S. Attorney's Office...

The Week in Securities Litigation: Companies With China-Based Operations Were SEC Focus

Companies with China based operations were a focus this week for the SEC. The Commission filed two financial fraud actions against companies whose operations were in the PRC. In one there seemed to be virtually no operations while in the other two sets of books were used to falsify revenue while proceeds...

The Week In Securities Litigation: Securities Enforcement Focus Continues To Be SAC Capital

The focus this week in securities enforcement continues to be SAC Capital. The firm's owner received a grand jury subpoena in the on-going criminal and civil insider trading investigations being conducted by the Manhattan U.S. Attorney's Office and the SEC. The investigations face a critical...

Nasdaq To Pay $10M Penalty For Role In Facebook IPO, Secondary Market Trading

WASHINGTON, D.C. - (Mealey's) In what is being called the largest ever penalty against an exchange, Nasdaq will pay a $10 million penalty to the Securities and Exchange Commission to settle claims that it violated federal securities laws as a result of its poor decision making during the initial...

The Week In Securities Litigation: Record Payments, Potentially Significant MOU

Record payments and a potentially significant MOU were the focus in securities enforcement litigation this week. French oil and gas giant Total paid the DOJ and the SEC $398 million to settle FCPA charges, the fourth largest sum paid in settlement of corruption charges. NASDAQ paid $10 million, the largest...

The Week In Securities Litigation: Money Market Funds The SEC Focus

Money market funds were the focus this week at the Commission. The agency issued proposed regulations for comment which may revise the operations of the widely used investment vehicles. The action follows a failed effort last year to propose new regulations and a warning from the FSOC that it may step...

The Week In Securities Litigation: SEC Settles Going Private Transaction Fraud Action

The Commission filed a settled action alleging fraud in connection with a going private transaction based on Exchange Act Section 13(e). The agency also brought its first action penalizing an exchange for regulatory filings this week. The SEC also added a managing director of a New York brokerage firm...

The Week In Securities Litigation: SEC Announces Modified Settlement Policy For Select Enforcement Actions

Commission Chair Mary Jo White announced a modified settlement policy for select enforcement actions. While most cases will be settled on a neither admit nor deny basis, the category of actions in which admissions will be required will be expanded. Currently only those actions where the defendant made...

Former Goldman Sachs Director Ordered To Pay $13.9 Million Penalty To Settle SEC Suit

By Timothy Raub NEW YORK — (Mealey’s) A federal judge in New York on July 17 ordered a former Goldman Sachs Group Inc. director to pay a $13.9 million penalty to settle claims with the Securities and Exchange Commission that he provided inside information to a former hedge fund manager...

The Week In Securities Litigation: SEC Begins Trial In Action Against Former Goldman Sachs Employee

The Commission began trial in its action against former Goldman Sachs employee Fabrice Tourre. The case centers on the market crisis action the SEC previously resolved with his former employer. The stakes are high in this case with significant media coverage and the Commission’s reputation hanging...

The Week In Securities Litigation: SAC Capital, Steven Cohen Focus Of Enforcement Litigation

SAC Capital and Steven Cohen were the focus of securities enforcement litigation this week. Criminal wire and securities fraud charges were brought against the four primary entities that make up SAC Capital. Civil failure to supervise charges were brought against the firm’s founder, Steven Cohen...

The Week In Securities Litigationa: SEC Enforcement Program Gets A Big Win

The SEC Enforcement program got a big win on Thursday in the Tourre case when a jury returned a verdict in favor of the agency. The case is an offshoot of the settled market crisis action against Goldman Sachs. Winning the case was a must for the agency after it stumbled in the trial of earlier market...

SEC Files Market Crisis Cases Against Bank of America, UBS

The Commission filed two new market crisis cases, one in conjunction with the Department of Justice. Once action is against Bank of America, N.A. centered on the sale of interests in an entity known as BOAMS 2008-A. SEC v. Bank of America, N.A., Civil Action No. 3:130-cv-0447 (W.D.N.C. Filed August 6...

The Week In Securities Litigation: SEC Files 2 Additional Market Crisis Cases

The Commission filed two additional market crisis cases this week. One named Bank of America as a defendant. The other charged UBS Securities. The SEC also filed an insider trading action against two close friends and cases charging manipulation, breach of duty and investment fund fraud. In addition...

SEC Prevails In Lawsuit Challenging Conflict Mineral Rules

The Commission prevailed in a dispute challenging its conflict minerals rules brought by business groups, a seemingly rare event in view of recent rulings against the agency by the D.C. Circuit on such issues. The rules were those enacted under Section 1502 of the Dodd-Frank Act which became Exchange...

SEC Files Another Investment Fund Fraud Lawsuit

Investment fund frauds continue to be a staple of SEC enforcement. This week the Commission filed another of these actions. The defendants are a former representative of a registered investment adviser and a licensed realtor. SEC v. Dearman, Civil Action No. CV-553 (N.D. Okla. Filed August 27, 2013)...

Securities Litigation Update For Aug. 9 – 30, 2013: Recent Outage At NASDAQ Focus Of Regulators

The recent outage at NASDAQ, the latest difficulty at an exchange, is a current focus of regulators. The SEC is investigating, reportedly examining the reasons a system for distributing stock quotes and prices was not adequate, according to a Reuters report (Reuters.com, Aug. 27, 2013). SEC Chair Mary...

The Week in Securities Litigation: Market Crisis Lawsuit, Olympus Case Enforcement Focus

DOJ’s market crisis suit against S&P and new charges against Olympus and a subsidiary in the UK are key focal points of securities enforcement litigation in this holiday shortened week. Responding to DOJ’s complaint, the rating agency claims it lacks merit and is driven by the fact that...

The Week in Securities Litigation: SEC Files Another Reg FD Action

The recent NASDAQ outage was a key focus this week. The SEC held a meeting attended by the leaders of the securities and options exchanges, FINRA, DTCC and the Options Clearing Corporation. At its conclusion the SEC Chair gave the participants a homework assignment: Come up with a list of concrete measures...

The Week In Securities Litigation: JP Morgan Settles London Whale Trading Charges

The Commission obtained its second settlement under its new policy which requires admissions in select, settling enforcement actions. This time JPMorgan settled books, records and internal control charges stemming from the so-called London Whale trading debacle. The settlement was based on admissions...

Williams Mullen: Court Holds Plan Sponsor’s SEC Filings Incorporated By Reference Into Retirement Plan’s Summary Plan Description, Constituted Part Of Plan Fiduciary’s Communications To Participants

By Mark S. Thomas and Robert W. Shaw | The U.S. Court of Appeals for the Ninth Circuit has held that an ERISA-regulated employee stock-ownership retirement plan’s incorporation by reference of the plan sponsor’s statements to the Securities and Exchange Commission (“SEC”...

Morgan Stanley To Settle Mortgage-Backed Securities Claims For $1.25B

NEW YORK — (Mealey’s) Morgan Stanley will pay $1.25 billion to settle claims that it, certain of its subsidiaries and others misrepresented the investment quality in more than $10.58 billion in certificates in connection with 33 securitizations of residential mortgage-backed securities Morgan...

DLA Piper: Expect Greater SEC Scrutiny Of Activist Hedge Funds That Share Information Or Collaborate In Advance Of Their Trades

By Perrie Michael Weiner and Patrick Hunnius A recent Wall Street Journal article – “Activist Investors Often Leak Their Plans to a Favored Few” – focused attention on “activist” investors and stock analysts who (as part of their bullish or bearish campaigns for...