Blog Archives

This Week In Securities Litigation (For the period Jan. 13 – 27, 2017)

During a two week period divided by the Inauguration, the Commission filed just under 40 actions. Chair Mary Jo White stepped down from her position at the agency after delivering her departing remarks at the New York Economic Club. In

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This Week In Securities Litigation (Week ending January 13, 2017)

FCPA enforcement was a key priority this week. The Commission filed two settled actions. Once involved a recidivist in which the firm made admissions in resolving the matter with the DOJ. Those admissions were essentially adopted by the SEC in

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SEC: Firm’s IC Failure Equals Liability For Subsequent Acquirer

The books, records and internal control provisions are an integral part of the FCPA. The Commission’s most recent action involving those provisions, however, centers on a claimed internal control failure by a firm when retaining a foreign agent and imposes

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This Week In Securities Litigation (Holiday edition – period from December 23, 2016 to January 6, 2017)

Questions regarding the validity of SEC ALJs continue to be a key focus for SEC enforcement. The Tenth Circuit concluded that the retention of SEC ALJs violated the Constitution’s Appointment Clause, setting up a potential conflict in the circuits that

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This Week In Securities Litigation (Week ending December 23, 2016)

As the Christmas and holiday season approaches, the SEC brought a series of actions. Those included two settled FCPA actions filed in tandem with the DOJ, one of which also involved foreign regulators and the payment of about $3.5 billion.

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DOJ, SEC, Foreign Authorities Settle FCPA Claims with Brazilian Firms For $3.5 Billion

Braskem S.A., a Sao Paulo based producer of petrochemicals and thermoplastic product whose ADRs are traded on the NYSE, and its controlling shareholder, Odebrecht S.A., a privately held Brazilian international construction firm, resolved FCPA bribery charges with the SEC, the

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This Week In Securities Litigation (Week ending Nov. 18, 2016)

SEC Chair Mary Jo White announced that she will step down when the new administration takes over. That will leave the Commission with two sitting Commissioners unless there are confirmation hearings during the lame duck session which seems highly unlikely.

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This Week In Securities Litigation (Week ending Oct. 28, 2016)

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. The agency also brought an insider trading action against a

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Embraer Settles FCPA Charges with DOJ, SEC

“Two out of three ain’t bad” was the refrain of a well known song by rock star Meatloaf some years back. While Meatloaf probably was not thinking about government investigations, sometimes the notion applies as aircraft manufacturer Embraer S.A. recently

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This Week In Securities Litigation (Week ending Oct. 7, 2016)

Insider trading was the focus this week, with the Supreme Court hearing argument in Salman v. U.S. The argument centered on the meaning and application of the Court’s 1983 decision in Dirks which drew a line between the prohibited an

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GSK Settles FCPA Charges with SEC

The SEC filed another settled FCPA action stemming from what the Order called “pervasive” practices in the China subsidiary of a multinational firm. This time GlaxoSmithKline plc was charged with internal control violations arising from the conduct of its China

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This Week In Securities Litigation (Week ending Sept. 30, 2016)

As the government fiscal year draws to an end, the Commission filed a series of enforcement actions. Those included two insider trading cases, an action alleging violations of the whistleblower provisions, another against a community bank tied to allegations about

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Lack of Due Diligence Re China Sub Yields FCPA Charges for Parent

Doing business in high risk areas of the world requires additional diligence to avoid corruption issues. The SEC’s latest FCPA settlement is an example of an action where the parent company took proactive steps, but they proved insufficient. In the

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This Week In Securities Litigation (Week ending August 12, 2016)

The D.C. Circuit handed down the first circuit court decision ruling on the Appointments Clause question concerning the retention of SEC ALJs. The court concluded that there was no violation of the Clause. The SEC brought an action this week

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This Week In Securities Litigation (Week ending July 29, 2016)

The Commission settled another FCPA action centered on the efforts of a Chilean airline to resolve its labor issues. The agency also filed four offering fraud actions: one based on an internet fraud; a second centered on the sale of

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SEC Resolves FCPA Action With LAN Airlines

The SEC resolved another FCPA action centered on the entry of LAN Airlines S.A. into Argentina. Previously, the Commission settled with the CEO of the company who agreed to the entry of a cease and desist order based on Exchange

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This Week In Securities Litigation (Week ending July 15, 2016)

The SEC filed a settled FCPA action in which the employees in the China subsidiary of the firm designed and adopted a bribery scheme to circumvent the compliance procedures the company had installed as a result of an earlier FCPA

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Compliance, Cooperation Mitigates FCPA Liability with DOJ-SEC

Well designed compliance systems coupled with solid internal controls can be instrumental in preventing violations of the FCPA. Despite best of efforts, there is no doubt that even a well-constructed compliance system can be circumvented. Johnson Controls, a global firm

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DOJ-SEC Resolve FCPA Actions – Consider Cooperation

A Massachusetts based medical imaging company resolved FCPA charges with the DOJ and the SEC stemming from actions taken by its Danish subsidiary and its CFO. The actions center on about 180 suspicious transactions in Russia involving $21.6 million in

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This Week In Securities Litigation (Week ending June 10, 2016)

The elements of an insider trading claim continued to be a key focus this week. The first circuit, following prior circuit precedent, held that a personal benefit based on a long term friendship and a steak dinner was sufficient, noting

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DOJ Declines Prosecution in Two FCPA Cases, SEC Executes NPAs

The DOJ declined prosecution in two self-reported potential FCPA actions while the SEC entered into non-prosecution agreements with each issuer. One matter involved Akamai Technologies, Inc. while the other centered on Nortek, Inc. Akamal Technologies, Inc. provides cloud services for

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This Week In Securities Litigation (Week ending April 15, 2016)

Budget hearings were a focus this week as the Chair of the SEC and Chairman of the CFTC visited Capitol Hill. Both sought substantial increases, requesting more money for technology, inspections and enforcement. While the administration supports increases whether election

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The Vegas Sands FCPA Action: Good Controls are Good Business

FCPA cases typically center on the payment of bribes to obtain or retain business. The bribes paid are usually small in comparison to the profits achieved – the obvious motive for the wrongful conduct. The profits of course are lost

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This Week In Securities Litigation (Week ending April 9, 2016)

The Foreign Corrupt Practices Act was a key focus this week. The DOJ announced a new one year Pilot Program which holds the promise of a significant reduction in penalties if the firm self-reports and takes a series of steps.

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DOJ’s New FCPA Pilot Program: The Offer of Enhanced Credit

DOJ’s continuing focus on individuals has spawned a new one year FCPA Pilot Program which offers companies enhanced cooperation credit The new Pilot Program is part of an overall effort to bolster FCPA compliance. Those efforts include increasing the size

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This Week In Securities Litigation (Week ending March 25, 2016)

The Commission prevailed on a summary judgment motion this week in a case based on an offering fraud. It also filed another settled FCPA action centered on gifts, travel and entertainment provided to healthcare professionals in return for business. Another

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This Week In Securities Litigation (Week ending March 4, 2016)

The SEC had a significant courtroom victory this week, prevailing in the Payton insider trading trial. A jury returned a verdict in favor of the agency. The defendants had previously pleaded guilty in a parallel criminal case. Those pleas were

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Olympus Settles FCPA Charges with DOJ

The Department of Justice resolved another FCPA investigation centered on payments made to health officials. Olympus Corporation of the Americas, a wholly owned subsidiary of Olympus Corporation, Tokyo, Japan, and Olympus Latin America, Inc., resolved FCPA charges with the DOJ.

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Qualcomm Settles FCPA Charges With SEC

Gifts and hospitality continue to be a key theme in the SEC’s latest FCPA case. The action also involves hiring relatives of officials and ignoring risk in the face of a weak compliance and internal control environment. In the Matter

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This Week In Securities Litigation (Week ending February 19, 2016)

The Commission filed two settled FCPA cases this week. On was resolved with the payment of almost $800 million to the SEC, DOJ and Dutch regulators where about $114 million in bribes were paid. The other centered on the payment

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