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‘Enforcement 40’ for 2020
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Join the Securities Litigation and Enforcement Group on LinkedInAuditors keep falling into the same trap | Financial Times
Last week, payments firm Wirecard admitted that €1.9bn of its cash probably never existed — and then it collapsed. It turns out that the German group’s auditors had failed for at least three years to request crucial account information from a Singapore bank where Wirecard said it had up to €1bn. Instead, EY relied on […]
Guest Post: “Stock Drop” Lawsuits | The D&O Diary
One often hears that “whenever there is a stock drop, there will be a lawsuit.” This of course is an overstatement. But how much of an overstatement is it? In this post, we answer that question in some detail. We identify all net-of-market stock drops of specified sizes in 2017 for common shares listed on […]
SEC Accounting and Auditing Enforcement Actions Down Slightly in 2019 | The D&O Diary
According to a new report from Cornerstone Research, the number of accounting and auditing enforcement actions the SEC initiated in 2019 was down slightly from the number initiated in 2018, but the number remained near the 2014-2018 average. Monetary settlements of accounting and auditing enforcement actions during 2019 totaled approximately $626 million. The June 25, […]
The Post-Cyan Section 11 Litigation Environment | The D&O Diary
Over the last two years, there have been two important judicial decisions concerning Section 11 litigation. In March 2018, the United States Supreme Court unanimously held in the Cyan case that state courts retain concurrent jurisdiction over lawsuits asserting liability claims under the Securities Act of 1933, a development that has increased the number of […]
Audrey Strauss Takes Over as Manhattan US Attorney Following Berman’s Dramatic Ouster | New York Law Journal
Audrey Strauss, the former top deputy to Geoffrey Berman, is set to take over the reins of the Manhattan U.S. attorney’s office this week, after her old boss agreed to resign Saturday following a 20-hour standoff with U.S. Attorney General William Barr over his removal. via Audrey Strauss Takes Over as Manhattan US Attorney Following […]
The SEC Loses an Arrow from Its Quiver in Liu v. SEC | Arnall Golden Gregory LLP – JDSupra
On June 22, 2020, the U.S. Supreme Court published its decision in Liu v. Securities and Exchange Commission, confirming the SEC’s authority to seek disgorgement from federal courts in enforcement actions. This was an important question that the Court raised but did not answer in 2017. The confirmation, however, comes with limitations not previously imposed […]
Liu v. SEC Highlights Limits of SEC Disgorgement Power
Three years ago, the Supreme Court ruled in Kokesh v. SEC that disgorgement in the context of an SEC enforcement action functions as a “penalty” for purposes of 28 U.S.C. § 2462 and is therefore subject to a five-year statute of limitations. 581 U.S. ___ (2017). In practice, the effect of Kokesh for companies and individuals under investigation by […]
China’s regulator gets tough on insider trading as it metes out record penalty on wrongdoers in the financial markets | South China Morning Post
China’s securities regulator slapped two individuals with a record fine for insider trading and confiscated their ill-gotten gains, meting out 3.6 billion yuan (US$508 million) of penalties in an unprecedented enforcement to stamp out corporate malfeasance in the country’s financial markets. Shanghai entrepreneur Wang Yaoyuan and his daughter Wang Chengcheng were fined 2.72 billion yuan […]
Former DOJ Prosecutor Jonathan Kravis Joins Munger, Tolles & Olson as Partner
Munger, Tolles & Olson announces today Jonathan Kravis has joined the firm as a partner in its Washington, D.C. office. Mr. Kravis spent 10 years as a federal prosecutor, most recently as deputy chief of the Fraud and Public Corruption Section in the U.S. Attorney’s Office for the District of Columbia, where he was responsible […]
Musk’s tweets enter the SEC | FT Alphaville
FT Alphaville believes this is the first time an SEC filing has featured a screenshot of tweets as part of a key announcement to shareholders. Now, some may just chalk this up to as yet another demonstration of the on-going governance conundrum that is Tesla Motors, and its affiliated businesses. Sure, screenshotting a social media […]