Blog Archives

This Week In Securities Litigation (Week ending March 24, 2017)

The number of settlements in securities class actions increased last year, according to Cornerstone Research. That fact, along with a finding that the amount of those settlements also increased, is detailed in the firm’s latest report on securities class actions.

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Securities Law Recidivist Pleads Guilty in Offering Fraud Case

The Commission and the DOJ have recently brought a number of securities fraud cases in which a key person in the misconduct concealed a prior criminal conviction for securities related offenses from investors. Another case in this series was announced

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This Week In Securities Litigation (Week ending Feb. 17, 2017)

Morgan Stanley settled another case with the Commission this week. This time its brokerage unit resolved an action centered on the improper sales of ETFs, admitting the facts in the Order. The Commission also brought another suspicious trading case last

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This Week In Securities Litigation (For the week ending Feb. 3, 2017)

The SEC is an agency in transition. There are three open slots on the agency waiting to be filled by the President and the Senate. Many of the senior staff positions are also now open including the Director of the

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SEC: Plan to Invest in Hamilton Tickets a Fraud

People are always searching for the next great thing; the next great innovation; the next great adventure; and the next great investment. Often it is the search for that safe, sure thing return; the one where the investment can’t be

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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 (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 2, 2016)

The focus this week was offering fraud actions. Three cases were brought. One involved a registered transfer agent. A second centered on claims that the defendant was an expert trader. The third was based on false claims regarding the defendant’s

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SEC Files Two More Offering Fraud Actions

Offering fraud actions are a staple of SEC Enforcement. While each action is different, yet typically each involves raising substantial amounts of cash from investors who are promised significant to outsized returns from a safe investment. Unfortunately the investments do

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This Week In Securities Litigation (Week ending Nov. 25, 2016)

In a holiday shortened week, the SEC brought actions involving: a financial fraud naming against the president of the firm who, assisted by two other officers named as defendants in an earlier Commission enforcement action, used sham agreements were used

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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 Nov. 11, 2016)

In a week that began with a focus on the election and ended with the commemoration of veterans day, the SEC brought a series of actions including: one that centered on the sale of unregistered securities in the form of

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SEC Files Two Fraud Actions

The Commission filed two more “to good to be true” fraud actions yesterday. One centered on an offering fraud involving a recycling firm which repeatedly promised investors that it was about to obtain the financing that would move the company

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Financial Executive Sentenced to Four Years in Prison

Former financial executive Andrew Caspersen was sentenced to serve four years in prison after defrauding investors of over $38 million followed by three years of supervised release. Restitution will be determined by the court at a later date. U.S. v.

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This Week In Securities Litigation (Week ending Nov. 4, 2016)

The Commission brought actions this week centered on the failure to properly conduct audits, an offering fraud and for acting as an unregistered broker. FINRA sanctioned eight firms for failing to adequately supervise the sale of a complex investment product.

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Job Seekers Become Offering Fraud Victims

Unemployed professionals thought they were being requested to appear for a job interview. On arrival they were solicited to purchase shares in a group of companies. In the end the the unemployed professionals were the victims of an offering fraud.

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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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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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This Week In Securities Litigation (Week ending Sept. 16, 2016)

The Commission prevailed in a jury trial this week against the City of Miami and its budget director in an action centered on three bond offerings. Cases brought by the agency this week also included: one against a firm and

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This Week In Securities Litigation (Two Weeks ending Sept. 9, 2016)

In the two weeks spanning the Labor Day weekend, the Commission continued bring cases arising from its inspection program. Two new actions alleging inadequate procedures regarding the disclosure of additional trading away fees incurred by customers in wrap fee programs

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SEC Charges Promoters of Notes Backed by Gold Mine, U.S.

When it is to good to be true, it almost always is. But returns of 53% to 120%, backed by millions of ounces of gold and bonds from the U.S. and Bank of America? Too hard to resist. Investors paid

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An SEC Offering Fraud, An Attorney and NFL and NBA Players

The SEC filed another offering fraud action which in part targeted current and former professional athletes. Investors in the scheme included NFL and NBA players. The attorney defendant claims to have tried to purchase a National Football League franchise at

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SEC Charges Firm, Promoters With Offering Fraud

The SEC brought another offering fraud action centered on false projections by an issuer regarding its expected performance. Unlike the action filed early last week, this one did not settle and is headed for litigation. SEC v. Enviro Board Corporation,

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This Week In Securities Litigation (Week ending August 26, 2016)

Numbers were the focus this week as the Commission filed 81 administrative proceedings (must be near fiscal year end) and two civil injunctive actions. Seventy-one of the actions involved municipal issuers who self-reported under the Municipalities disclosure initiative. Another ten

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SEC Files Settled Offering Fraud Action

Offering fraud actions continue to be a staple of SEC enforcement. The Commission’s most recent action is this stream of cases involved a limited liability company that never engaged in business. SEC v. Jones, Civil Action No. 1:16-cv-01695 (D.D.C. Filed

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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 August 5, 2016)

The SEC prevailed on summary judgment in an action centered on an offering fraud. The principals of the scheme were found to have violated the antifraud provisions while a codefendant was determined to have acted as an unregistered broker. Two

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SEC Prevails in Offering Fraud Action

The SEC prevailed in an offering fraud case against the promoters of an oil and gas investment scheme. The court granted summary judgment in favor of the Commission. SEC v. Downey, Civil Action No. 1:14-cv-00185 (N.D. Tex. Nov. 20, 2014).

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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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This Week In Securities Litigation (Week ending July 22, 2016)

Investment advisers were at the center of a number of actions brought by the Commission this week . Two proceedings involved a registered adviser and its COO that were involved in an unregistered and fraudulent offering; two other actions centered

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SEC Offering Fraud Action Built on Duty to Disclose Omissions

The Commission filed another offering fraud action in what has become virtually a continuous stream of these cases. Its latest action centers on the sale of interests in a payday lending business operated in partnership with a federally recognized Native

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