San Francisco SEC Office Trying to Slim Down, Toughen Up (The Recorder)
The Recorder | August 21, 2009
After weathering criticism for being too lax, the Securities and Exchange Commission is remodeling itself to be more like its tough older cousin, the Department of Justice. Changes in policy since the Democrats took over the White House have given SEC lawyers more power to quickly pursue investigations.
Why is the SEC not acting against financial intermediaries? (the bespeckled accountant)
the bespeckled accountant: | August 21, 2009
The fact that the SEC is not going after the financial institutions for their part in assisting these companies in falsifying their financial results is unfortunate and surprising. It is surprising because the SEC understands well the risks posed by these third-parties.
Wall Street ‘Corruption’ Might Buy Crook a Break (Ann Woolner, Bloomberg)
Bloomberg News | August 21, 2009
Imagine Tony Soprano getting convicted and given a shorter prison sentence because he worked in a criminal environment. That would be getting it backward.
A federal judge implied this week he may go easy on two brokers convicted of securities fraud because they worked within a “culture of corruption.”
The UK Gets Serious About Overseas Corruption: The Bribery Bill and SFO Guidance (Arnold & Porter)
Arnold & Porter | August 20, 2009
The UK’s Serious Fraud Office (SFO) has recently released guidance1 on its
approach to investigating allegations of corruption overseas. The SFO will
continue to be the primary enforcer under a proposed Bribery Bill, now being
considered by Parliament, if and when it becomes law.
Beware Bernie Madoff Books (David Weidner, Dow Jones)
Dow Jones | August 20, 2009
Where is all the money? Many of these books will likely be in the discount bin by the time the average citizen finds out. We’re just going to have to wait.
In the meantime, the best chapters on the Madoff case are coming from the U.S. District Attorney’s Office for the Southern District of New York.
THE REYES DECISION: DID THE COURT MISS THE KEY ISSUE? (SEC ACTIONS)
SEC ACTIONS | August 19, 2009
The error by the government was far more serious than a misleading final argument. Indeed, it was fundamental to the trial process. When the fact finding process is skewed as here, the remedy is not a new trial, it should be dismissal.
Brokers Aren’t Responsible for Bad Bets (Charles R. Schwab, WSJ Op-Ed)
The Wall Street Journal | August 19, 2009
The implication of this lawsuit is that firms like ours should have known that the market would fail. Should we also have known that Lehman Brothers or Bear Stearns were going to go under and compensate clients who bought their equity or debt? Should we have been able to predict which financial institutions would be the beneficiaries of government bailouts and which would not? I think it’s fair to say we have all been surprised by many events this past year.
What, Options Backdating? Again? (The D & O Diary)
The D & O Diary | August 19, 2009
The publication in yesterday’s Wall Street Journal of an article entitled “Backdating Likely More Widespread” caused several callers to ask me whether I thought we might see a new wave of options backdating litigation. But while the academic research on which the Journal article was based is certainly interesting, I am skeptical that the new “revelations” will result in a renewed wave of options backdating lawsuits.
FCPA Opinion Procedure Release Posted (The Filing Cabinet)
The Filing Cabinet | August 18, 2009
The Department of Justice recently issued its first Foreign Corrupt Practices Act Opinion Procedure Release in just over a year. The procedure process allows issuers and domestic concerns to get the Attorney General’s opinion on whether certain prospective conduct conforms with the Department’s present enforcement policy regarding the FCPA’s anti-bribery provisions. Over the last 15 years, Richard Cassin notes that there have been fewer than two releases per year on average.
More About Extraterritoriality and the U.S. Securities Laws (The D & O Diary)
The D & O Diary | August 18, 2009
While we wait to see whether the U.S. Supreme Court will grant the pending petition for a writ of certiorari in connection with the Second Circuit’s recent landmark opinion in the Morrison v, National Australia Bank case, the lower courts must continue to wrestle with questions regarding the extraterritorial application of the U.S. securities laws, particularly with respect to the claims of so-called “f-cubed” or “foreign-cubed claimants.”
What Madoff’s Chief Fraud Officer Has to Offer (Peter J. Henning, DealBook)
DealBook | August 18, 2009
Mr. DiPascali has every incentive to cooperate to the fullest after seeing the 150-year sentence his former boss and mentor received. He is unlikely to receive anything near that if he can explain how he worked as the chief fraud officer for Mr. Madoff and, more importantly, back that information up with some objective evidence. Saying that everything you’ve accomplished over the last 20 years was fake does not make you a very credible witness.