The U.S. Supreme Court limited the power of the Securities and Exchange Commission (SEC) to enforce civil penalties via in-house tribunals in its decision in SEC v. Jarkesy, released on June 27, 2024. In its decision,...more
On June 27, 2024, the U.S. Supreme Court decided SEC v. Jarkesy, No. No. 22-859, holding that the Seventh Amendment entitles a defendant to a jury trial when the Securities and Exchange Commission seeks civil penalties for...more
The SEC Division of Examinations recently released its 2022 Division of Examinations “Priorities.” The 2022 Priorities provide critical insight into what the Division of Examinations (the “Division”) considers the most...more
4/1/2022
/ Broker-Dealer ,
Compliance ,
Cryptoassets ,
Data Security ,
Emerging Technologies ,
Environmental Social & Governance (ESG) ,
Investment Adviser ,
Private Funds ,
Regulation Best Interest ,
Retail Investors ,
SEC Examination Priorities ,
Securities and Exchange Commission (SEC) ,
Supervision
The lack of specific guidance regarding failure to supervise liability for chief compliance officers (“CCOs”) has been a controversial and opaque topic that both FINRA and the SEC have struggled with for well over a decade....more
On March 16, 2022, the Securities and Exchange Commission charged Crosby (Texas) Independent School District (Crosby) and its former Chief Financial Officer, Carla Merka, with misleading investors in a $20 million municipal...more
3/22/2022
/ Administrative Orders ,
Anti-Fraud Provisions ,
Bonds ,
Enforcement Actions ,
Failure To Disclose ,
Financial Statements ,
Fraud ,
GAAS ,
Misleading Statements ,
Municipal Bonds ,
Penalties ,
Securities and Exchange Commission (SEC)
On February 14, 2022, the SEC announced charges against BlockFi Lending LLC – a New Jersey-based cryptocurrency lending platform – for failing to register its crypto lending product and violating the Investment Company Act of...more
Two recent enforcement actions by the U.S. Securities and Exchange Commission (SEC), including a recent settled action against Kraft Heinz Co. (“Kraft”), underscore the agency’s renewed and continuing focus on accounting and...more
On July 13, 2021, the SEC announced charges against Stable Road Acquisition Company (“Stable Road”), its sponsor, SRC-NI, its CEO, Brian Kabot, Stable Road’s proposed merger target Momentus Inc.(“Momentus”), and Momentus’s...more
7/16/2021
/ Audits ,
CEOs ,
Enforcement ,
Initial Public Offering (IPO) ,
Investment Adviser ,
Investors ,
Publicly-Traded Companies ,
Securities and Exchange Commission (SEC) ,
Securities Litigation ,
Securities Regulation ,
Special Purpose Acquisition Companies (SPACs)
With Colorado Governor Jared Polis expected to sign the Colorado Privacy Act, SB-190 into law in the coming days, Colorado will join California and Virginia as the third state with a comprehensive data privacy law.1 The...more
Upcoming Changes to Rule 10b5-1:
The SEC is seeking to propose four key changes to executive stock trading plans under Rule 10b5-1 in October. Its Chairman, Gary Gensler, reported that the SEC is considering “freshen[ing]...more
7/2/2021
/ 10b5-1 Plans ,
Broker-Dealer ,
Compliance ,
EDGAR ,
Gary Gensler ,
Insider Trading ,
Investment Adviser ,
Market Manipulation ,
Proposed Amendments ,
Publicly-Traded Companies ,
Securities and Exchange Commission (SEC) ,
Trading Plans
On Tuesday, the U.S. Securities and Exchange Commission (“SEC”) announced that Gurbir Grewal will be the Director of the Division of Enforcement, effective July 26, 2021. Grewal has been the Attorney General of New Jersey...more
As publicly reported late last week, the Securities and Exchange Commission’s Division of Enforcement (SEC) sent voluntary requests for information to a range of public companies and investment firms seeking voluntary...more
6/24/2021
/ Audits ,
Broker-Dealer ,
Cyber Attacks ,
Cybersecurity ,
Data Breach ,
Investment Adviser ,
Popular ,
Publicly-Traded Companies ,
Request For Information ,
Securities and Exchange Commission (SEC) ,
SolarWinds ,
Voluntary Disclosure
On Friday June 4, 2021, Securities and Exchange Commission Chair Gary Gensler removed the head of the Public Company Accounting Oversight Board (PCAOB), an independent agency created by the Sarbanes-Oxley Act of 2002 that is...more
Responding to a “concern” from Chief Compliance Officers (CCOs) to the purported increase in enforcement actions holding compliance personnel personally liable, the New York City Bar Association recently released a framework...more
On May 3, 2021, the Securities Exchange Commission (“SEC”) announced charges against Under Armour Inc. (“Under Armour”) for “misleading investors as to the bases of its revenue growth and failing to disclose known...more
On April 22, 2021, Ms. Alex Oh was named the new Director of the U.S. Securities and Exchange Commission’s (SEC) Division of Enforcement. Ms. Oh was most recently a partner in private practice where she served as co-chair of...more
We have all seen the daily stories about SPACs (special purpose acquisition companies) and their attack on the IPO and M&A markets over the last 15 months. For context, the number of SPAC initial public offerings (IPOs) has...more
As we await the impact of the Biden Administration on the direction of the SEC, we have been given a glimpse of what is to come in a speech last month by the newly confirmed commissioner, Caroline Crenshaw. Specifically,...more
As political leaders continue to debate how to address climate change, the SEC is poised to take (enforcement) action. In the latest example of how the Biden Administration is influencing the priorities the SEC, the agency...more
The Division of Examination’s (former OCIE) annual announcement of its exam priorities is always noteworthy, as it provides helpful insight into this division’s thinking and can serve as a roadmap for regulated entities to...more
3/10/2021
/ Anti-Money Laundering ,
Biden Administration ,
Climate Change ,
Cryptocurrency ,
Digital Assets ,
Environmental Social & Governance (ESG) ,
FinTech ,
Innovation ,
Investment Adviser ,
Libor ,
Market Infrastructure ,
OCIE ,
Regulation Best Interest ,
SEC Examination Priorities ,
Securities and Exchange Commission (SEC)
The U.S. Securities and Exchange Commission (SEC) has restored the authority of senior Division of Enforcement (Enforcement) officials to initiate investigations, which had been revoked during the Trump administration.
On...more
On January 18, 2021, the incoming President’s Transition Team announced additional key administration post nominees, including Mr. Gary Gensler as SEC Chair. The announcement specifically provided the following regarding Mr....more
1/20/2021
/ Administrative Proceedings ,
Biden Administration ,
Broker-Dealer ,
Compliance ,
Hedge Funds ,
Insider Trading ,
Investment Adviser ,
New Legislation ,
Private Equity ,
Publicly-Traded Companies ,
Securities and Exchange Commission (SEC) ,
Supervision
On January 8, 2021, the SEC issued a cease-and-desist order, Release No., 90875 (available here), formally resolving proceedings against Deutsche Bank AG. Deutsche Bank agreed to pay over $125 million as part of a global...more
Last week, on December 16, 2020, Chinese-based coffee chain Luckin Coffee Inc. (“Luckin”) agreed to a $180 million settlement with the United States Securities and Exchange Commission (“SEC”). Luckin’s American Depositary...more
12/23/2020
/ Anti-Fraud Provisions ,
China ,
Compliance ,
Earnings Management ,
Financial Reporting ,
Foreign Entities ,
Foreign Issuers ,
Fraud ,
Investigations ,
Investors ,
Scienter ,
Securities and Exchange Commission (SEC) ,
Settlement ,
Supervision
The SEC’s Division of Enforcement issued its annual report on November 2, 2020. According to the report, fiscal year 2020 saw the SEC file a total of 715 enforcement actions, representing a whopping 17% drop from the 862...more