Driven in significant part by the new actions filed as part of the SEC’s Share Class Selection Disclosure Initiative, the number of SEC enforcement actions against public companies and subsidiaries remained at “near-record levels” in the first half of fiscal year 2018, according to a recent report. The report, published by Cornerstone Research in collaboration … Continue Reading
Among the agencies largely closed by the current partial U.S. federal government shutdown is the U.S. Securities and Exchange Commission (SEC). In the following guest post, John Reed Stark, President of John Reed Stark Consulting and former Chief of the SEC’s Office of Internet Enforcement, takes a look at what the SEC’s closure means for … Continue Reading
In November, when the SEC released its annual enforcement activity report, the report showed that during the fiscal year that ended on September 30, 2018 both the volume of the agency’s enforcement activity and the level of financial recoveries increased compared to the prior fiscal year. The agency’s report did not separate out its enforcement … Continue Reading
Both the volume of SEC enforcement activity and the level of financial recoveries increased in the fiscal year that ended September 30, 2018, according to the agency’s annual enforcement activity report. The increases came after activity had been down in the prior year, the first year under the current presidential administration. However, the agency’s enforcement … Continue Reading
Most readers are undoubtedly familiar with the concept of “insider trading” – that is, the purchase or sale by company insiders of their personal holdings in company shares based on material non-public information. Readers may be less familiar with “outsider trading,” which is trading in shares of a company on the basis on material non-public … Continue Reading
Earlier this week, media reports circulated that this past spring Google had exposed the private data of thousands of the Google+ social network users and then opted not to disclose the issue, in part because of concerns that doing so would draw regulatory scrutiny and cause reputational damage. In the wake of these revelations, one … Continue Reading
One of the trendy concepts in certain circles in recent years has been the idea of litigation management bylaws – that is, the adoption by company of bylaw provisions that help manage the company’s litigation risks. For example, one bylaw provision that has been widely adopted by publicly traded companies is a forum selection provision … Continue Reading
Amidst the flurry of Supreme Court decisions, new lawsuits, and other activity in the last few days, I have not yet had the chance to comment on a particularly important development earlier this week. That is, on March 19, 2018, the SEC announced the two largest whistleblower bounty awards in the history of its whistleblower … Continue Reading
SEC Commission Michael Piwowar caused quite a stir last summer when he suggested that the SEC would favorably view submissions by IPO companies that included bylaw provisions requiring mandatory arbitration of securities claims. The idea of mandatory arbitration for shareholder claims has continued to circulate in the intervening months. In the past few days, several … Continue Reading
One of the Trump administration’s high profile initiatives is the review and rollback of many of the Dodd-Frank Act’s features. Consistent with these efforts, an updated version of a bill that would undo many of the Act’s provisions is now making its way through Congress. The Financial Choice Act (H.B. 10) was introduced in April … Continue Reading
Among the many concerns in the early days of the new Presidency is the question of what we can expect from the SEC in the new administration. In the following guest post, Blair Nicholas and David Kaplan of the Bernstein Litowitz Berger & Grossman law firm advocate that the SEC take an aggressive approach to securities … Continue Reading
The SEC is the primary regulatory body charged with the enforcement of the U.S. securities laws. Most insurance and legal professionals are well-aware of the agency and familiar with its regulatory role. But in an era that has been (at least up until now) characterized by heightened enforcement activity, many of those professionals may be … Continue Reading
One of the recurring questions in the securities regulatory enforcement arena has been the question of whether or not the Securities and Exchange Commission’s use of administrative law judges violates the U.S. Constitution. As discussed in the following guest post from Sarah A. Good and Laura C. Hurtado of the Pillsbury law firm, the Tenth … Continue Reading
While the confirmation earlier this week that Mary Jo White will step down as SEC Chair at the end of the Obama administration raises interesting questions about the SEC’s possible future direction and priorities, the agency’s public company-related enforcement activities during the last fiscal year provide some very interesting insights about the SEC’s recent priorities. … Continue Reading
Perhaps SEC officials hoped they were bolstering their agency’s image as a tough regulator when they reported on October 11, 2016 that the SEC had filed a record number of enforcement actions in fiscal year 2016. That was certainly the way the officials quoted in the agency’s press release played it. But if that was … Continue Reading
The SEC has long made it clear that it intends to protect whistleblowers and to suppress activities it believes will have the effect of discouraging whistleblower activity. The agency recently launched enforcement actions against companies that had incorporated various waivers in employee severance agreements that discouraged employees from reporting possible securities law violations to the … Continue Reading
Last September, amidst considerable fanfare, the U.S. Department of Justice released a new directive – now universally known as the Yates Memo – in which it restated and reinforced the agency’s commitment to targeting corporate executives in cases of corporate wrongdoing. The cornerstone of the agency’s new policies is the specification that in order for … Continue Reading
The SEC wants you to know that it means business about its whistleblowing program. On April 1, 2015, in the latest in a series of steps to protect and encourage whistleblowers, the agency entered an order in an enforcement action against KBR saying that the company’s confidentiality requirements for internal investigation witnesses violated the agency’s … Continue Reading
A number of factors might be supposed to affect the SEC’s exercise of its judgment in deciding which firms to investigate. Some possibilities that immediately come to mind are the nature and seriousness of the suspected problem; the way the problem came to the agency’s attention; and the availability of resources to investigate the problem. … Continue Reading
With the arrival of the new Chair of the SEC, Mary Jo White, the agency has undertaken a variety of new enforcement initiatives. Among the most interesting is the agency use of data anallytics to try to uncover public company accouunting abuses. The following guest post from Christopher L. Garcia, Paul Ferrillo of the Weil, … Continue Reading
Whistleblower reports to the SEC continued to rise during the latest fiscal year, according to the agency’s annual Dodd-Frank Whistleblower Program report to Congress. According to the November 15, 2013 report, a copy of which can be found here, there were 3,238 whistleblower reports to the SEC during the 2013 fiscal year, brining the total … Continue Reading
