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This Week In Securities Litigation (Week of Sept. 16, 2019)

By T. Gorman on September 15, 2019

A look forward; a look back: With only two weeks until the end of the Government fiscal year it seems apparent that the Commission’s enforcement Division is not about to hit warp speed as it did last year with the filing of cases. With budget hearings looming in early October, perhaps the more interesting question is what plan the agency is going to roll out to justify a budget increase. Increased enforcement efforts – generally…

SEC Actions

Suit by States Challenges SEC Regulation Best Interest

By T. Gorman on September 12, 2019

Regulation Best Interest, the long studied and discussed Commission rule that addressed the standards governing broker-dealers when making an investment recommendation was challenged by in a suit filed by seven states and the District of Columbia. State of New York v. SEC, Civil Action No. 1: 19 -cv-0835 (S.D.N.Y. Filed Sept. 9, 2019). The suit claims the SEC’s regulation “increases confusion about the standards of conduct that apply when investors receive recommendations and advice from…

SEC Actions

SEC Chairman Clayton: Stepping Up Anti-Corruption Enforcement Efforts

By T. Gorman on September 11, 2019

SEC Chairman Jay Clayton called for greater international cooperation in the enforcement of anti-corruption statutes such as the Foreign Corrupt Practices Act in remarks delivered before the Economic Club of New York on September 9, 2019 (here). The comments followed a review of initiatives taken by the Commission under his tenure to aid the main street investor, a key focus of the agency under Chairman Clayton. The FCPA, spawned from corruption uncovered in…

SEC Actions

SEC Charges Cartoon Firm With Sale of Unregistered Securities

By T. Gorman on September 9, 2019

Offering frauds have long been a staple of SEC enforcement. Many of these actions are straight forward, involving the sale of securities for a virtually worthless or non-existent business. Some are Ponzi schemes. Virtually all of these actions promise the investor a safe investment with good to sky-high returns. The SEC’s most recent action in this area is different. It is based on the sale of unregistered securities. The seller is a securities law recidivist…

SEC Actions

This Week In Securities Litigation (Week of Sept. 9)

By T. Gorman on September 8, 2019

A look forward; a look back: The future looms as September begins. A Commissioner position will be opening on the SEC. A position is open on the PCAOB. Budget hearings will begin next month on Capitol Hill for the agency following a Congressional hearing at the end of September at which Chairman Clayton and the four Commissioners will testify. Individually, and collectively, these events may bode change for the Securities and Exchange Commission and those…

SEC Actions

Financial Advisor Pleads Guilty to Fraud

By T. Gorman on September 5, 2019

The Commission’s focus on retail investors has translated into brining increasing numbers of actions against investment advisers. A number of those actions center on fraudulent schemes which were little more than simple theft. Those, and other similar actions typically result in the filing of parallel criminal charges by the U.S. Attorney’s Office. One of those actions is U.S. v. Hafen, (S.D.N.Y. Plea Sept. 4 2019). Ellis H. Hafen was a financial adviser at two investment…

SEC Actions

SEC. CFTC Settle With OCC, Imposing $20 Million in Penalties

By T. Gorman on September 4, 2019

The SEC and the CFTC resolved enforcement actions against the Options Clearly Corporation, imposing $20 million in penalties for regulatory failures. This is the first such actions. It serves to highlight the key financial position of the OCC in the U.S. regulatory system. In the Matter of the Options Clearing Corporation, Adm. Proc. File No. 3-19416 (September 4, 2019); In the Matter of The Options Clearing Corporation, CFTC Docket No. 19-19 (September 4, 2019). The…

SEC Actions

This Week In Securities Litigation (Week of Sept. 3)

By T. Gorman on September 2, 2019

A look forward; a look back: As the end of the Government fiscal year loams, the Commission seems to have kicked the case filing machine into gear. Last week the agency filed 15 new cases. While at times the Commission has matched that total, the question here is if that pace continues. If so the stats for new actions might eclipse last year’s total. Cases filed last week included those centered on: Internal controls, pre-release…

SEC Actions

Happy Labor Day!

By T. Gorman on August 28, 2019

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SEC Actions

SEC Uses Statistical Analysis To Support Cherry Picking Action

By T. Gorman on August 27, 2019

The Commission in recent years has focused in part on developing its data analysis capabilities to inform its enforcement investigations and actions. On place where those efforts are frequently on display is in so-called “cherry picking” cases. Those actions center on, for example, a trader allocating profitable trades to the account of one or more favored clients while the unprofitable trades are placed in other accounts. In a series of cases the Commission has used…

Thomas O. Gorman

Thomas O. Gorman Blogs

Blog Authors

This Week In Securities Litigation (Week of Sept. 16, 2019)

Suit by States Challenges SEC Regulation Best Interest

SEC Chairman Clayton: Stepping Up Anti-Corruption Enforcement Efforts

SEC Charges Cartoon Firm With Sale of Unregistered Securities

This Week In Securities Litigation (Week of Sept. 9)

Financial Advisor Pleads Guilty to Fraud

SEC. CFTC Settle With OCC, Imposing $20 Million in Penalties

This Week In Securities Litigation (Week of Sept. 3)

Happy Labor Day!

SEC Uses Statistical Analysis To Support Cherry Picking Action

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