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January 4, 2021

French bank Union de Banques Arabes et Françaises will pay $8.6 million to resolve an investigation into its operation of U.S. dollar accounts on behalf of Syrian financial institutions subject to U.S. sanctions.  UBAF’s practices allowed the sanctioned entities to conduct transactions through a U.S. bank following internal transfers between the sanctioned entities and non-sanctioned entities that were also UBAF customers.  OFAC

December 22, 2020

Student loan servicer Discover Bank, together with its affiliates the Student Loan Corporation and Discover Products, Inc., will pay a $25 million penalty and at least $10 million in consumer redress to resolve allegations that the bank violated a 2015 Consent Order by failing to provide the consumer redress that order required and by continuing to misrepresent minimum loan payments, and also misrepresenting the amount of interest consumers paid and other material information including interest rates, payments, due dates, and the availability of rewards, among other things.  The CFPB also found additional unfair acts and practices by defendants, including unauthorized payment transfers.  CFPB

December 22, 2020

Santander Consumer USA Inc., which originates and services non-prime auto loans, was found to have violated the Fair Credit Reporting Act by providing erroneous consumer loan information to credit reporting agencies between 2016 and 2019.  A CFPB Consent Order requires the bank to pay a $4.75 million monetary penalty and undertake specific compliance steps.  CFPB

December 17, 2020

Robinhood Financial LLC will pay $65 million to resolve an SEC investigation into its disclosures regarding the firm’s receipt of "payment for order flow" – payments from trading firms for routing customer orders to them – as well as its alleged failure to secure best execution on customer orders.  According to the SEC, while Robinhood advertised to customers that trades were "commission-free," it steered customer orders to trading firms that paid Robinhood for order flow but provided inferior trade prices to Robinhood customers, thereby misrepresenting the true cost of trades.  SEC

December 9, 2020

ICE Data Pricing & Reference Data LLC agreed to pay $8 million to resolve charges that between 2015 and 2020 it failed to take adequate steps to ensure the accuracy of securities pricing data it supplied to clients, including by relying on single broker quotes which did not reasonably reflect the value of certain securities.  This conduct affected the prices ICE Data PRD provided for more than 40,000 fixed-income securities. SEC

December 7, 2020

The largest non-bank mortgage servicer in the country, Nationstar Mortgage, has agreed to pay $79.2 million in restitution to over 55,000 borrowers in all 50 states and the District of Columbia who were harmed by the lender’s noncompliance with numerous laws, including the Consumer Financial Protection Act of 2010, Real Estate Settlement Procedures Act (RESPA), and Homeowner’s Protection Action of 1998 (HPA), from 2011 to 2017.  Additionally, Nationstar will pay another $7.1 million in costs and penalties to government parties.  CFPB; DOJ; CA AG; NY AG; PA AG

October 21, 2020

Cryptocurrency issuer Kik Interactive Inc. will pay a $5 million penalty in a consent judgment resolving claims by the SEC that Kik’s unregistered offering of digital “Kin” tokens in 2017 violated U.S. securities laws.  The consent judgment finds that Kin tokens were investment contracts and the offering did not qualify for any exemption from registration requirements.  Kik sold the tokens through both public and private sales; the court found that the sales were a single integrated offering.   SEC

October 15, 2020

Energy company Andeavor LLC will pay a $20 million penalty to resolve allegations that, while the company was in merger discussions with Marathon Petroleum  Corp. in 2018, it implemented a stock buyback plan without taking adequate compliance steps, including an evaluation of whether the company was in possession of material non-public information about corporate developments.  The Marathon merger, which valued Andeavor at over $150 per share, was announced one month after Andeavor completed the buyback at an average price of $97 per share.  SEC

October 14, 2020

Michael Allen Worley of Baton Rouge, Louisiana, was sentenced to 12 years in prison following his plea of guilty on charges including bank fraud.  Worley admitted that between 2014 and 2018 he fraudulently obtained more than $40 million in loans and investments from banks and private equity firms for himself and his businesses.  Worley’s fraud included false statements that inflated his assets, understated and omitted his liabilities, misrepresented his income, and misrepresented the intended use of loan proceeds. Worley was also ordered to pay $15.75 million in restitution to his victims.  USAO MD LA
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