Archive

July 19, 2018

A federal court in Washington, DC has ordered two Irish companies, Intrade the Prediction Market Limited and Trade Exchange Network, to pay $3M in penalties relating to the two companies permitting US customers to trade over 5,000 binary options on off-exchange options platforms, as outlawed by the CFTC. Trade Exchange Network was also in violation of a 2005 cease and desist order issued by the CFTC. CFTC

July 18, 2018

The SEC has charged Temenous Advisory, a Connecticut-based investing advisory firm, of putting $19M investor money into high-risk investments and also receiving high commissions from those investments. The misled senior citizens and individuals approaching retirement into buying stakes in four risk, illiquid private offerings. SEC

July 5, 2018

Credit Suisse will pay a total of $77 million – $47 million as a criminal penalty and $30 million in disgorgement and interest – to resolve charges that it obtained investment banking business in the Asia-Pacific region by corruptly influencing foreign officials in violation of Foreign Corrupt Practices Act (FCPA).  The government charged that Credit Suisse attempted to secure banking business by offering of employment to family and friends of influential Chinese government officials.  SEC; DOJ; USAO EDNY

June 29, 2018

The SEC announced that Morgan Stanley Smith Barney (MSSB) has agreed to pay a $3.6 million penalty and to accept certain undertakings for its failure to protect against its personnel misusing or misappropriating funds from client accounts. According to the SEC’s order, MSSB’s insufficient policies and procedures contributed to its failure to detect or prevent one of its advisory representatives, Barry F. Connell, from misusing or misappropriating approximately $7 million out of four advisory clients’ accounts in approximately 110 unauthorized transactions occurring over a period of nearly a year. SEC

July 3, 2018

Illinois announced a $20 million settlement with Royal Bank of Scotland as a result of the bank’s misconduct in its marketing and sale of risky residential mortgage-backed securities (RMBS) leading up to the 2008 economic collapse. The settlement with Royal Bank of Scotland resolves an investigation by Madigan’s office over the bank’s failure to disclose the true risk of RMBS investments. IL

July 2, 2018

The CFTC filed a civil enforcement action in the U.S. District Court for the Eastern District of New York, charging Harris Bruce Landgarten of Old Brookville, New York, with defrauding participants in a commodity pool that he operated, the Tradeanedge Members Fund (TMF). The CFTC Complaint also charges Landgarten with providing his pool participants false account statements and with commingling pool funds with non-pool funds. Further, Landgarten was also charged with one count of obstructing the CFTC’s investigation related to Landgarten’s communications with one of his pool participants, who was a potential witness, while the CFTC’s investigation that resulted in the filing of this enforcement action was pending. CFTC

June 4, 2018

The CFTC issued an order against Société Générale S.A. settling charges of manipulation of Yen LIBOR, attempted manipulation and false reporting of Euribor and U.S. Dollar, Yen and Euro LIBORs, and aiding and abetting traders at another bank in their attempts to manipulate Euribor. The bank engaged in this misconduct to make money on its trading positions and to protect its reputation from speculation that it was having more difficulty borrowing unsecured funds than other banks. Société Générale will pay a civil monetary penalty of $475 million, cease and desist from further violations, and adhere to specific undertakings to ensure the integrity of its LIBOR, Euribor, and other benchmark interest rate submissions in the future. CFTC

June 19, 2018

Luis Diaz and Luis J. Diaz, owners of a Miami-based export business, were convicted of operating an unlicensed money transmitting business and running a large, international money laundering scheme. The Diaz brothers avoided the anti-money laundering safeguards required of licensed institutions and moved over $100M through US banks and other financial institutions. Both brothers were sentenced to two years in prison. USAO Southern District of New York

June 13, 2018

Jamal Y. Vance and his company All City Investments, LLC will pay over $770,000 for fraudulently soliciting customers for forex trading and failing to register as a Commodity Trading Advisor. According to the Consent Order, Vance induced customers using false and misleading data on All City’s website, including a trading track record and purported testimonials. CFTC

June 15, 2018

New York and over forty other states announced a $100 million dollar settlement with Citibank to resolve allegations that the bank fraudulently manipulated U.S. Dollar LIBOR, a critical interest-rate benchmark that impacts global financial instruments worth trillions of dollars. The New York Attorney General’s Office led the investigation, which found evidence that Citibank made material misrepresentations and omissions regarding the LIBOR benchmark to state and local governments, as well as non-profit, private, and institutional counterparties. The states alleged that Citibank entered numerous LIBOR-referenced transactions without disclosing that it had reason to believe that its own LIBOR submissions did not accurately represent its borrowing rates. NY