Securities

By Linda Fuerst on June 25, 2019

In (Re) El-Bouji, 2019 ONSEC 19, the Ontario Securities Commission (OSC) determined that the test on a motion to strike portions of an affidavit filed by Staff in response to the respondent’s motion challenging the Commission’s jurisdiction to adjudicate certain allegations in a Notice of Hearing and Statement of Allegations is essentially the same as the test set out in Rule 25.11 of the Ontario Rules of Civil Procedure. Orders by the OSC to…

Securities Litigation and Regulatory Enforcement

Fifth Circuit Overturns Receiver’s Settlement Barring Third-Party Claims Against Stanford Financial Insurers

By Toby M. Galloway & Matthias Kleinsasser on June 25, 2019

The Fifth Circuit overturned a U.S. District Court’s approval of a settlement between Ralph Janvey, the Receiver for Stanford International Bank, and various insurance company Underwriters, under which the Underwriters had agreed to pay $65 million to the Stanford Receivership estate. Writing for the Court, Judge Edith H. Jones held that the District Court abused its discretion in approving the settlement because the injunction issued by the District Court (referred to as a “bar order”)…

Free Writings + Perspectives

SEC Issues Concept Release on Harmonization of Securities Offering Exemptions

By Michael L. Hermsen on June 25, 2019

On June 18, 2019, the US Securities and Exchange Commission (SEC) issued a concept release soliciting “comment on possible ways to simplify, harmonize, and improve the exempt offering framework to promote capital formation and expand investment opportunities while maintaining appropriate investor protections.” Under the Securities Act of 1933, as amended (Securities Act), every offer and sale of securities must be registered with the SEC unless an exemption from registration is available. In the concept release,…

Securities litigation and enforcement

Clearing the Way: “Ice Breaker” Settlements in Class Actions

By Linda Fuerst on June 25, 2019

In a recent class action settlement approval hearing, Justice Belobaba of the Ontario Superior Court affirmed the value of early “ice breaker” settlements in complex class actions involving multiple defendants. In such a settlement, one defendant settles ahead of the rest for what may be viewed as a “token” amount, along with a pledge to provide cooperation to the plaintiffs. (Di Filippo and Caron v. Bank of Nova Scotia et al, 2019 ONSC 3282). The…

FCPA Professor

The Underwhelming Walmart Enforcement Action

By Mike Koehler on June 24, 2019

Last week Walmart resolved its long-standing Foreign Corrupt Practices Act scrutiny by agreeing to pay approximately $283 million to the DOJ/SEC (see here and here for prior posts). $283 million is $283 million. However, as highlighted in this post (a post informed by FCPA practice experience including conducting FCPA internal investigations around the world and having read and analyzed every FCPA enforcement action in the 40+ year history of the FCPA), the actual allegations / findings…

SEC Actions

The Currency Was Virtual, the Con Was Old Fashioned

By T. Gorman on June 24, 2019

All things crypto or virtual are in vogue these days. The mention of “blockchain” by a company executive might cause the share price to move. The suggestion that crypto currency is involved can create huge interest. The intense interest in all things crypto may be one of the reasons that pricing for the various coins is so volatile. It is also a reason that investors may be easily defrauded by the unscrupulous. That is precisely…

Free Writings + Perspectives

FINRA Proposes Changes to its Fund Communication Rules

By Brian Hirshberg on June 24, 2019

On June 20, 2019, the Financial Industry Regulatory Authority, Inc. (“FINRA”) proposed amendments to FINRA Rule 2210 (Communications with the Public) and FINRA Rule 2241 (Research Analysts and Research Reports) to further the rules adopted by the Securities and Exchange Commission (“SEC”) last year as required by the Fair Access to Investment Research Act of 2017 (the “FAIR Act”). The FAIR Act required the SEC to adopt rules to extend safe harbor communication protections to…

FCPA Professor

Issues To Consider From The Walmart Enforcement Action

By Mike Koehler on June 23, 2019

This prior post went in-depth into the long-awaited Walmart Foreign Corrupt Practices Act enforcement action in which the company agreed to pay the DOJ/SEC approximately $283 million. This post highlights additional issues to consider from the enforcement action. Timeline Walmart was under FCPA scrutiny since approximately mid-2011. Thus, from start to finish its FCPA scrutiny lasted an unconscionable approximate 8 years. There is simply no excuse for this and the DOJ/SEC have long-recognized the issues…

SEC Actions

Walmart Finally Settles Anti-Corruption-FCPA Investigations

By T. Gorman on June 23, 2019

“Its been a long time coming. . .” according to song writer David Crosby’s lyrics. While those words probably were not penned with the Foreign Corrupt Practices Act in mind, many in Bentonville, Arkansas may well feel it has been a “long time coming.” For years after expanding from a huge U.S. retailer into a global one the firm’s international compliance procedures were ineffective to virtually non-existent. For years after the New York Times reported…

FCPA Professor

Registration Opens For The FCPA Institute – Boston (Oct. 3-4)

By Mike Koehler on June 23, 2019

Last week professionals from all over the country and from leading firms and companies came to Minneapolis to elevate their Foreign Corrupt Practices Act knowledge and practical skills at the FCPA Institute – Minneapolis hosted by Dorsey & Whitney. The next stop for the FCPA Institute is Boston on October 3-4 in an event hosted by K&L Gates. Since 2014, the FCPA Institute has elevated the FCPA knowledge and practical skills of approximately 250 diverse professionals…