Do Shareholder Class Actions Make Sense? (Michael Orey, BusinessWeek)
Business Week | September 18, 2009
Judge Rakoff’s ruling in the SEC-BofA case prompts a question that seems to garner little attention outside a small circle of academics: Why do we tolerate the same perverse approach and empty outcomes in the resolution of private shareholder class actions?
Shareholders aren’t regulators (Felix Salmon, Reuters)
Reuters | September 18, 2009
Shareholders simply don’t have the time, information, or ability to police companies: they’re owners, not managers. And they certainly have no way to address systemic, as opposed to company-specific, risks.
Stanford’s New Lawyers: ‘As Different as Punk and Country Music’ (WSJ Law Blog )
The Wall Street Journal | September 18, 2009
The lawyers handed to Stanford and who will work free of charge could actually be about the best Stanford could have hoped for, with or without a lofty price tag.
The Latest FCPA Forecast From U.S. Regulators WrageBlog
WrageBlog | September 17, 2009
Yesterday, Mark Mendelsohn of the DOJ, Cheryl Scarboro of the SEC, and Edward Coopers of the FBI spoke at a conference in Washington, DC. After all of the usual disclaimers by each speaker, here is the most recent summary of trends and predictions in the FCPA enforcement arena.
Is a Company-Provided Lawyer Really Your Own? (Zach Lowe, AmLaw Daily)
AmLaw Daily | September 17, 2009
Many problems can arise when a lawyer defending a company in a criminal case also represents individual employees who may later face charges related to the same case. It often creates conflicts of interest concerns, similar to those involving Proskauer Rose’s Thomas Sjoblom in the Allen Stanford fraud case.
Merrill Bonus Judge Is a Stickler on Fairness, Transparency (David Glovin, Bloomberg)
Bloomberg News | September 17, 2009
Jed Rakoff, the federal judge who rejected a $33 million settlement between the Securities and Exchange Commission and Bank of America Corp. over Merrill Lynch & Co. bonuses, is a stickler for fairness and transparency.
Poor Allen Stanford (Simple Justice)
Simple Justice | September 17, 2009
Dick DeGuerin did a lot right when he began his representation of billionaire R. Allen Stanford. He also did one thing really wrong. He forgot to get paid. As nice as it is to be a billionaire, it doesn’t help much when your assets are seized pending forfeiture. Now Dick DeGuerin has to withdraw from the case, having come to the conclusion that he bears little resemblance to Mother Teresa.
When Was the Last Time the SEC Created a Division? 1972 (TheCorporateCounsel.net Blog)
TheCorporateCounsel.net Blog | September 17, 2009
When was the last time the SEC created a division? The Louis Loss treatise had the answers.
Unsolicited Offer to the Securities & Exchange Commission: Hire Me (zero hedge)
Zero Hedge | September 17, 2009
I personally just can’t sit idly by and facepalm/laugh/cry anymore. I am hereby volunteering my services to help my Country and investors World-wide by going to work for the frenemy: the Securities & Exchange Commission.
Crisis Probes Reach Boardroom (WSJ)
The Wall Street Journal | September 17, 2009
New York Attorney General Andrew Cuomo’s subpoenas of five Bank of America Corp. board members move government investigations of the financial crisis into the boardroom, highlighting potential risks for independent directors.
What Kind of Judge Stands Up For Truth and Justice? (Steven Pearlstein, WaPo)
The Washington Post | September 16, 2009
I don’t know about you, but I’ve had it up to here with activist judges who think they can overturn decades of legal precedent and ignore well-established norms of legal behavior in the pursuit of vague ideals like “justice” and “morality.”
Where are the subprime perp walks? (Colin Barr, Fortune)
Fortune | September 15, 2009
Three years after the housing bubble popped, prosecutors have yet to bring a major case tied to the subprime fiasco. What gives?
BofA Ruling Questions an SEC Weapon (Kara Scannell, WSJ)
The Wall Street Journal | September 15, 2009
Legal experts said Monday’s rejection by U.S. District Judge Jed S. Rakoff of the agency’s proposed $33 million settlement with Bank of America Corp. could bring tougher scrutiny of other settlements over alleged wrongdoing.
Another Take Two Scandal, or Just Another Wall Street Scandal? (Market Rap)
Market Rap | September 15, 2009
Certain news organizations are receiving sensitive information in advance just so they can write out their stories in advance. Is this really necessary?
Unscrewing Shareholders (Daniel Fisher, Forbes.com)
Forbes | September 15, 2009
A federal judge in New York got his dander up about a practice that is routine in courts around the country: making shareholders pay twice for securities fraud.
SEC needs to act more like a prosecutor to catch future Madoffs (Star-Ledger)
Star-Ledger | September 15, 2009
According to the report, using his perceived influence, Madoff intimidated regulators into failing to press for critical information, played different offices against one another, then used the SEC’s lack of enforcement as a marketing tool to draw more investors into his scheme. All of these findings point to the need for an overhaul of the SEC’s approach to regulation.
No Hollywood Ending (The FCPA Blog)
The FCPA Blog | September 15, 2009
The trial’s tragic outcome shouldn’t surprise anyone. There hasn’t been an acquittal in an FCPA prosecution since 1991.
Judge Rakoff Rejects Bank of America and SEC’s Arguments (WSJ)
The Wall Street Journal | September 15, 2009
New SEC chief Mary Schapiro figured she’d play off public outrage with a civil lawsuit that would earn some headlines. BofA in August settled for $33 million, neither admitting nor denying guilt. Judge Rakoff was having none of it. In a 12-page opinion, he tore into the SEC for ignoring its own guidelines and penalizing shareholders rather than the individuals who supposedly acted improperly.
IS THE SEC CONTINUING TO TAKE A RAIN CHECK? (SEC ACTIONS)
SEC ACTIONS | September 14, 2009
Bank of America calls for a swift and complete evaluation not just of the Enforcement Division and its program but of the Commissioners who are the SEC, the predicate for their decision and the direction in which they are taking the agency.
But Who Is Watching the Regulators? (Gretchen Morgenson)
The New York Times | September 14, 2009
Those in the public sector ask us to believe that regulators who snoozed during the credit bubble will be alert to emerging problems on their beats when the next mania begins.