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President Trump’s 2012 criticism of the Foreign Corrupt Practices Act (FCPA) is well-documented. At the time, news outlets reported that business mogul Trump commented on Wal-Mart’s alleged facilitation payments in Mexico to obtain various licenses and permits, opining that FCPA was a “horrible law and it should be changed,” and adding that it put U.S. businesses at a “huge disadvantage.” Trump went on to say, “[w]e are like the policemen for the world, it’s ridiculous.”…
Apparently lost in the news of the impending departure of SEC Chair Mary Jo White is her recent suggestion to expand liability of corporate executives. In a speech on November 18, 2016, Chair White suggested a potential change in federal securities law that would hold executives accountable even if they are not involved in the misconduct and did not know about it. Given recent signals from the new administration in Washington, we believe this potential…
SEC and DOJ Targeting Fraud Involving Pre-IPO Companies Historically regulators have been reluctant to interfere with the complex world of pre-IPO  financing and private market transactions, which tend to involve the most sophisticated investors.  However, several recent public statements make it clear that both the U.S. Department of Justice (DOJ) and the U.S. Securities and Exchange Commission (SEC) are focused on finding fraud and other civil and criminal violations at private Silicon Valley companies.  Citing…
The Securities and Exchange Commission has had its fair share of controversy related to its in-house administrative enforcement proceedings.  In early June, the SEC invited one of its own Administrative Law Judges to submit an affidavit on the topic of whether he had been pressured to rule in favor of the agency following allegations of bias brought by Timbervest LLC, and a Wall Street Journal article that discussed allegations by a former ALJ that…
On April 1, 2015, the Securities and Exchange Commission announced its first enforcement action against a company for using improperly restrictive language in confidentiality agreements allegedly aimed at stifling potential whistleblowers. The SEC charged KBR Inc. with violating whistleblower protection Rule 21F-17 enacted under the Dodd-Frank Act, which prohibits companies from “imped[ing] an individual from communicating directly with the Commission staff about a possible securities law violation, including enforcing, or threatening to enforce, a…