Top Ten Federal Financial Fraud Recoveries of 2020

The U.S. government has many enforcement options for financial and investment fraud, including those that provide for whistleblower rewards such as the SEC Whistleblower Program, the CFTC Whistleblower Program, and the IRS Whistleblower Program.  These programs, along with a new one under the Anti-Money-Laundering Act of 2020, are open for business and promise to pay millions of dollars in whistleblower awards in exchange for information and assistance in exposing fraud....

Catch of the Week: Vitol to Pay $163 Million to Settle Criminal and Civil Charges Related to Oil Bidding in Brazil, Mexico, and Ecuador

This week’s Catch of the Week highlights the participation of the Commodity Futures Trading Commission (CFTC) in the settlement of an international bribery and kickback scandal involving Vitol Inc., a member of the Vitol Group, the world’s largest privately owned oil and gas trading firm.  As part of the settlement, Vitol will pay $90 million in fines to the DOJ, $45 million to Brazilian authorities, and at least $28 million...

JPMorgan Chase Pays nearly $1 Billion in Fines for Market Manipulation of Precious Metals and U.S. Treasuries

JPMorgan Chase & Co. agreed to pay over $955 million to settle civil and criminal charges over a scheme involving fake trades in precious metals and U.S. treasuries designed to manipulate the market in an effort to enhance the bank’s profits and cut losses. The multi-agency enforcement action was brought by the Commodity Futures Trading Commission (CFTC), the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC). For...

Catch of the Week: Bank of Nova Scotia Fined for Commodities Fraud and False Statements to Investigators

Self-disclosure offers wrong-doing corporations a path to leniency: Fess up, the government says, and we’ll go easier on you.  But as the Bank of Nova Scotia learned, you had better reveal the full extent of the problem, or you are just making your problem worse. The Bank had made a self-disclosure that secured it's leniency and an $800,000 deal for charges of commodities fraud.  When the CFTC later determined that...

Catch of the Week: Interactive Brokers Pays $38 Million for Failures in Money-Laundering and Supervision

Brokerage firm Interactive Brokers LLC will pay $38 million in penalties to settle charges from multiple U.S. market regulators regarding its anti-money laundering practices, including alleged failures to file suspicious activity reports (SARs).  The discount broker has paid an $11.5 million penalty to settle charges with the Securities and Exchange Commission over the deficiencies in its internal controls that failed to spot suspicious trades involving microcap stocks, known as penny...

COVID-19 Fraud

What potential whistleblowers need to know about reporting fraud related to the Coronavirus (COVID-19) pandemic COVID-19 Fraud & the Role of Whistleblowers The government is rolling out massive spending programs and regulatory changes to fight the COVID-19 pandemic and ease its economic fallout.  Meanwhile, businesses of all kinds are adjusting to sudden new economic realities. With this historical government spending, and the material changes in the regulatory and economic environment,...

Top Ten Federal Financial Fraud Recoveries of 2019

The U.S. government has a range on enforcement options for financial and investment fraud, including those that provide for whistleblower rewards such as the SEC Whistleblower Program, the CFTC Whistleblower Program, and the IRS Whistleblower Program, each of which are very much open for business and continuing to pay millions of dollars in whistleblower awards in exchange for their assistance in exposing fraud. However, financial fraud is as pervasive as...

Catch of the Week: Ericsson Agrees to Pay Record-Setting $1 Billion for FCPA Violations

This week’s “Catch of the Week” is a Swedish fish: Telefonaktiebolaget LM Ericsson, the telecommunications giant based in Stockholm, agreed to pay over $1 billion in penalties, including $540 million to the SEC and $520 million to the DOJ, for violating the Foreign Corrupt Practices Act (“FCPA”).  This is one of the largest FCPA settlements in history.  Ericsson’s corrupt conduct was pervasive and long-standing:  it involved high-level executives, spanned seventeen...

September 27, 2019

An undisclosed anonymous whistleblower who reported violations of the Commodity Exchange Act under the CFTC Whistleblower Reward Program has been awarded $7 million by the CFTC.  The nature of the underlying CFTC investigation was not reported.  CFTC

Catch of the Week — Merrill Lynch Commodities Inc.

Merrill Lynch Commodities Inc (“Merrill”), a commodity trading subsidiary of Bank of America Corporation, agreed on June 25th to two $25 million settlements with both the Department of Justice (“DOJ”) and the Commodity Futures Trading Commission (“CFTC”) to resolve allegations it conducted deceptive trading practices in United States commodities markets. DOJ Criminal Violations This settlement resolved allegations that from at least 2008 to 2014, Merrill precious metals traders manipulated precious...