Daily Archives: March 31, 2023, 2:37 pm

SEC Charges Three Executives at U.S. Navy Shipbuilder Austal USA with Accounting Fraud

The Securities and Exchange Commission today charged three executives of Mobile, Alabama-based shipbuilder, Austal USA LLC, for orchestrating a fraudulent revenue recognition scheme that allowed its parent company to meet or exceed analyst expectations. The SEC alleges that, from at least January 2013 through July 2016, Austal USA’s former president, Craig D. Perciavalle, its current director of financial analysis, Joseph…

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SEC Awards More Than $12 Million to Two Whistleblowers

The Securities and Exchange Commission today announced awards of more than $12 million to two whistleblowers who provided information and assistance in a successful SEC enforcement action. The first whistleblower prompted the opening of the investigation and provided information on violations that would otherwise have been difficult to detect. This whistleblower identified key witnesses, helped staff understand complex fact patterns…

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Judge axes Biogen class action, rips shareholder lawyers for ‘constant misrepresentation’ | Reuters

But few dismissal decisions, at least in my experience, castigate plaintiffs’ lawyers for trying to do just that – which is why a ruling on Wednesday from U.S. District Judge William Young caught my eye. *** Young concluded that none of the 25 allegedly false statements was actually false and that the complaint failed to show Biogen’s fraudulent intent. But…

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SEC Charges Hedge Fund Trader and Broker-Dealer Partner in Multi-Million Dollar SPAC Insider Trading Scheme

The Securities and Exchange Commission today filed insider trading charges against Sean Wygovsky, a former trader at a Canadian asset management firm, and Christopher Matthaei, a former partner at a U.S. broker-dealer, for using nonpublic information in advance of at least seven merger announcements involving Special Purpose Acquisition Companies (SPACs) to earn illicit profits of more than $3.4 million. The…

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Location Drives Tough Calls on Confessing Corporate Crime to DOJ

Lawyers for corporations thinking about confessing misdeeds in exchange for heightened leniency from prosecutors are weighing where they can get the better deal: Justice Department headquarters or a US attorney’s office. Counsel may have a clearer path to avoiding charges through a process known as declination by walking into the Criminal Division in Washington. DOJ’s January policy revision spelled out…

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Israeli Universities Escape Madoff Trustee’s $50 Million US Suit

Four universities in Israel successfully defeated a New York bankruptcy court lawsuit brought by the trustee for Bernie Madoff’s defunct investment firm but still face claims abroad over their receipt of roughly $50 million in funds derived from Madoff’s Ponzi scheme. Judge Cecelia Morris of the US Bankruptcy Court for the Southern District of New York ruled that trustee Irving…

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SEC Pursues ‘Dealer’ Definition Expansion, to Industry’s Dismay

The Securities and Exchange Commission is finalizing a rule that, as proposed, would clarify and expand the definition to include some financial firms—such as high-frequency traders—that have traditionally not been considered a dealer. Industry advocates say the agency also is using recent lawsuits against penny-stock flippers to go further than it’s likely to do in its rulemaking—to stake out the…

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SEC’s Gary Gensler Asks for $2.4 Billion to Fight Crypto ‘Misconduct’ | Observer

The SEC’s proposed 2024 budget would be around a $200 million increase from 2023. The agency is requesting funding for 170 new positions, in addition to funding for staff hired the year prior, testified Gensler. A significant portion of these jobs would entail adding to the SEC’s enforcement and examinations divisions, which account for around half of the agency’s staff,…

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