Traditionally, private fund managers have looked at the
section 3(c)(1) or section 3(c)(7) exemptions from the definition of
"investment company" to avoid the restrictions of being regulated under the
Investment Company Act. Dodd-Frank defined...
FDA chemist Cheng Yi Liang was named as a defendant along
with his son Andrew Liang in a criminal insider trading complaint. U.S. v.
Liang (D. Md. Filed March 29, 2011). The SEC filed a parallel action
against the chemist. His son was only named as...
So when you read about a small, $50 million dollar, Ponzi
scheme coming to light, you almost always read about some gullible investors
who had no idea they couldn't make 50% returns in a legitimate business deal.
The list of victims was recruited...
Professor Bainbridge discusses the Delaware law aspects
of insider trading, including leading Delaware decisions on the topic, here, in
connection with reports about possible insider trading accusations involving
one of Warren Buffett's top aides...
In the week ending with "April Fools Day," the Commission
continued to issue proposed regulations to implement the Dodd-Frank Wall Street
and Consumer Protection Act. SEC Enforcement focused on investment fund fraud
actions, filing or resolving...
With four more securities suits involving Chinese or
China-linked companies this past Friday, the phenomenon of securities class
action lawsuits against these firms has emerged as one of the most distinct
securities litigation trends so far this year...
The staff of the Division of Investment Management at the
Securities and Exchange Commission has prepared responses to some questions
206(4)-5 under the Investment Advisers Act of 1940.
Here are a few that caught my eye:
The Taylor, Bean & Whitaker investigation spawned
guilty plea number five on Friday. Paul Allen, the former CEO of the collapsed
firm, pleaded guilty to conspiracy to commit bank and wire fraud and making
false statements. U.S. v. Allen (E.D. Va...
The fees paid to fraud professionals such as attorneys,
consultants and accountants to clean up the mess that Bernie Madoff's famous
Ponzi scheme left is projected to reach over $1 billion! According to the
Washington Post the fees paid to such...
In my year-end
securities litigation survey , I noted that while a number of new trends
emerged during 2010, one securities lawsuit filing trend had remained constant
during the year - that is, life sciences companies remained a favored
The relationship between capital formation, effective
regulation and how this is being thwarted by certain foreign issuers were the
subjects of SEC Commissioner Luis Aguilar's remarks to the Council of
Institutional Investors at their Spring Meeting...
The government's highly publicized insider trading
investigations took another turn on Monday. Those inquiries, as discussed here , appear to focus on
traders, mutual funds, hedge funds and others who use expert networks. They at
The limited liability company has been the entity of
choice for many small businesses, investment partnerships, holding companies,
and others in most US states for many years. For several years, more LLCs have
Earlier I had pointed out how a real
estate fund manager could be considered an investment adviser and have to
register with the SEC under the Investment Advisers Act.
In the Proposed
Changes to Form ADV published on November 19, the SEC has made...
The task of where to begin a full compliance and ethics
program can often times appear quite daunting. Most US companies fully
understand the need to comply with the Foreign Corrupt Practices Act (FCPA).
However most companies are not created out of...
Armed with a new white paper from the Council of
Institutional Investors and the recently released Institutional Shareholder
Services’ 2011 updates for its U.S. Corporate Governance Policy, shareholders
seem well-equipped to tackle a myriad of...
With all the interest in the ongoing Galleon/SAC/expert
networks insider trading investigation, this run of the mill scam almost
slipped past. Thankfully this one doesn't involve lawyers - just bad
accountants and traders. The SEC charged a former...
Settlement is the critical goal in every claim that
cannot be resolved otherwise. It terminates the open dispute, it provides the
parties with finality, and, perhaps, most importantly, it provides the parties
with repose. After a settlement is final...
For private fund managers, one troubling aspect of Form
ADV had been the calculation of "assets under management" in item 5.F. If
securities are less than 50% of the portfolio then the portfolio would not be a
FCPA enforcement has been marked by the aggressive
approach adopted in recent years by The Department of Justice and the SEC. As
Acting Deputy Assistant Attorney General Greg Andres told a Senate Committee
this week "over approximately the last...
Back in 2005, Associate Director Office of Compliance
Inspection and Examinations of the SEC, Gene Gohlke gave a speech addressing
hedge funds who would soon have to register under the doomed hedge fund rule.
He focused on what the funds needed in...
At the " Examining Enforcement of the
Foreign Corrupt Practices Act " hearings on November 30, 2010, before
the US Senate Judiciary Committee ,
Subcommittee on Crime and Drugs, Michael Volkov presented an interesting idea
which he believes...
Though it quickly recovered, Bank
of America's share price declined earlier this week on speculation that the
company is the bank whose internal documents WikiLeaks intends to post on the
Internet at some future date. According to news
Insider trading continues to dominate securities
enforcement. In the U.S., the Galleon cases are marching toward trial, while
the Manhattan U.S. Attorney rolls up guilty pleas and cooperating witnesses.
The recently revealed insider trading inquiry...
At the Taiwan Corporate Governance Association's
Corporate Governance Summit in Taipei on December 3, 2010, Delaware Supreme
Court Justice Randy J. Holland gave the keynote speech entitled " Corporate
Social Responsibility, Shareholders and...