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Securities Fraud

This archive displays posts tagged as relevant to securities fraud. You may also be interested in the following pages:

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Top Ten SEC and CFTC Recoveries of 2023

Posted  01/24/24
Foreign Exchange Graph
It was an active year for fraud enforcement at the Securities and Exchange Commission (SEC) and Commodities Futures Trading Commission (CFTC).  Though by no means was it a record year for either regulator in terms of big-ticket wins.  Aside from the CFTC's $1.7 billion recovery from South African crypto company Mirror Trading for foul play with foreign currency transactions, the balance of the Top-10 recoveries was...

Top FCPA Recoveries of 2023

Posted  01/19/24
Mix of Foreign Currency Scattered Around
The Foreign Corrupt Practices Act (FCPA) bars payments to foreign officials for any kind of business advantage, such as securing government contracts or other kinds of favorable business treatment.  The statute covers any form of consideration including gifts, meals, travel, and entertainment.  It also imposes strict record-keeping and internal control requirements to prevent falsifying company books and records...

SEC Goes After JP Morgan for Violating Whistleblower Protection Rule

Posted  01/18/24
J.P. Morgan Logo on Building
Add JP Morgan Securities to the ever-expanding list of companies the Securities and Exchange Commission (SEC) has gone after for violating the agency's Whistleblower Protection Rule -- SEC Rule 21F-17(a).  This rule broadly prohibits companies from taking any action to impede or discourage whistleblowers from reporting suspected securities violations to the SEC.  Yesterday (January 16), the SEC announced the JP...

Top Ten SEC and CFTC Whistleblower Awards for 2023

Posted  01/16/24
Anonamous Person on Phone Pointing to Book with Charts and Numbers
It was a relatively quiet year for the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) in their payout of whistleblower awards under their respective whistleblower programs.  Under the SEC Program and CFTC Program -- both enacted under the Dodd-Frank Wall Street Reform and Consumer Protection Act -- whistleblowers who provide information that leads to a successful government...

Catch of the Week: SAP SE

Posted  01/16/24
Briefcase Full of Money
This week's Department of Justice (DOJ) Catch of the Week goes to SAP SE (SAP).  On Wednesday (January 10), the German-based software company agreed to pay roughly $220 million to settle DOJ and SEC charges of violating the Foreign Corrupt Practices Act (FCPA) through bribes to government officials in South Africa and Indonesia. The FCPA bars payments to foreign officials for any kind of business advantage, such...

December 26, 2023

A temporary restraining order was issued on December 21 against ArciTerra Companies LLC and its CEO Jonathan M. Larmore, along with Cole Capital Funds LLC, an entity formed by Larmore. Larmore and other charged entities misappropriated more than $35 million from private real estate funds and other investment vehicles to fund his family's lavish lifestyle. In another scheme, Larmore issued a press release from Cole Capital Funds, announcing they were buying 51% of WeWork's minority ownership shares at nine times the current trading price. Not disclosed was that Larmore had purchased more than 72,000 call options in the days prior to the press release. Larmore's intent was to earn a windfall on the options; instead, the press release was delayed so most of the call options expired before he could exercise them. SEC

December 22, 2023

Brooge Energy Limited, former CEO Nicolaas Lammert Paardenkooper, and former Chief Strategy Officer and interim CEO Lina Saheb settled SEC fraud charges for misstating Brooge's revenues from 2018 to 2021 connected to a $500 million securities sale. Brooge fabricated invoices to support the inflated revenues and provided them to auditors to hide the fraud. Brooge will pay a $5 million penalty for violating the antifraud, proxy statement, reporting, and books and records provisions of the federal securities laws. Paardenkooper and Saheb will each pay $100,000 and are subject to permanent officer and director bars. SEC

November 21, 2023

Rio Tinto plc, Rio Tinto Limited, and Rio Tinto's former CEO Thomas Albanese have agreed to entry of a final judgment, ordering it to pay $28 million and permanently restraining Rio Tinto from violating Sections 13(a) and 13(b)(2)(A) of the Exchange Act and Rules 12b-20 and 13a-16 thereunder. The judgment stems from the SEC's 2017 complaint which alleged that Rio Tinto's public filings contained misleading statements about the value of its Mozambican coal assets. Rio Tinto has agreed to retain an independent consultant to review its compliance with accounting standards. Albanese will pay a $50,000 civil penalty and is required to cooperate in the SEC's continuing investigation into Rio Tinto's former CFO Guy Elliott. SEC

SEC Charges yet Another Company for Violating Whistleblower Protection Rule

Posted  10/6/23
silver whistle with Securities Exchange Commission logo
On September 29, the Securities and Exchange Commission (SEC) announced that New York-based investment adviser D. E. Shaw & Co. agreed to pay $10 million to settle charges of violating the SEC's Whistleblower Protection Rule.  It is the third SEC settlement in September for violating the rule, which prohibits a company from taking any steps to interfere with a whistleblower's efforts or incentives to report potential...

SEC Takes Down Yet Another Company Trying to Silence Whistleblowers

Posted  09/28/23
Red Whistle Zipped
It was only a few weeks ago that the Securities and Exchange Commission (SEC) slapped down Monolith Resources for forcing departing employees to sign separation agreements making them waive their right to any whistleblower rewards for reporting fraud to the government.  In announcing that enforcement action, the SEC stressed the need for companies to appreciate that taking any steps to silence whistleblowers is...
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