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The Week In Securities Litigation: SEC Actions, Diago Plc, FINRA Investor Warning


The SEC entered into an agreement with the Capital Turkey Securities Regulator this week calling for mutual cooperation in a number of areas including enforcement. The Commission also continued implementing Dodd-Frank, issuing additional rules concerning large traders, asset backed securities and short form eligibility. The Court of Appeals for the District of Columbia vacated the SEC's new proxy access rules, concluding they were not issued in accordance with the Administrative Procedure Act. This is the second time in the last two years the Court has struck down an SEC rule for not complying with the APA.

The Commission also settled an FCPA action involving liquor giant Diago plc. The case was based on hundreds of small payments made to facilitate the sale of its products as well as lobbying fees paid to a foreign official and political party member to secure a huge tax refund and improper travel and entertainment expenses. None of the payments were properly recorded.

Finally, FINRA issued an investor warning, cautioning the public about seeking higher returns in certain high risk products. The regulator also settled another action centered on sales practices used in connection with the marketing of auction rate securities.

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For more cutting edge commentary on developing securities issues, visit SEC Actions, a blog by Thomas Gorman.

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