March 16, 2022 — The SEC announced charges, and a settlement of those charges with Crosby Independent School District (Crosby ISD) and its former Chief Financial Officer, Carla Merka. They were charged with misleading investors in the sale of $20 million of municipal bonds in order to pay its outstanding […]
Enforcement
Advisor to Pay More Than $30 Million for Undisclosed Conflicts of Interest
March 3, 2022 — The Securities and Exchange Commission today announced that registered investment adviser City National Rochdale, LLC (CNR) has agreed to pay more than $30 million to settle charges that its undisclosed conflicts of interest defrauded current and prospective clients. The money CNR pays will be placed into […]
BlockFi Agrees to Pay $100 Million in Penalties and Pursue Registration of its Crypto Lending Product
Introduction BlockFi is a cryptocurrency lending startup that offers crypto loans. Since its launch, the company has been criticized for its lending practices. In particular, it has faced questions about whether it can comply with regulations requiring it to register as a money transmitter and obtain a license. SEC Charges […]
Defense of an SEC Enforcement Investigation
SEC enforcement investigations cover a wide range of targets and witnesses, from the big investment banks and their employees, to public companies to private companies who are soliciting investments, small companies. The SEC conducts its investigations privately, and does so by requesting voluntary cooperation or issuing subpoenas for documents and […]
Robo-Adviser Settles SEC Charges of Misleading Investors
A robo-adviser is an automated investment tool that uses mathematical algorithms to evaluate the prospects of various investment options and, in theory, choose the best one. Robo-advisors are digital platforms that provide automated, algorithm-driven financial planning services with little to no human supervision. A typical robo-advisor collects information from clients […]
FINRA 2022 Exam Priorities
It is always good to know what regulators are going to focus on, and to prepare for that exam. Today FINRA released its 2022 Report on Examination and Risk Monitoring Program (the Report). While not a road map it provides firms with information that may help inform their compliance programs. […]
Can The SEC Bring Criminal Charges?
While the SEC has extremely broad investigative and enforcement powers, it cannot file criminal charges. It can, and often does, work with the Department of Justice and the United States Attorney’s Office to bring those charges. The SEC and the DOJ often work together, with the SEC sending its more […]
SEC Charges Three Florida Residents in Multi-Million Dollar Insider Trading Scheme
The Securities and Exchange Commission announced charges against three Florida residents for trading in advance of market moving announcements involving DSW Inc., Rite Aid Corporation, and an attempt to acquire Aphria Inc., a Canadian cannabis-related business. According to the SEC’s complaint, David Schottenstein of Surfside, Fla. repeatedly obtained inside information […]
SEC Charges Financial Company For Fraudulent Schemes to Boost Stock Price
The SEC has charged Medallion Financial Corp., a Delaware company headquartered in New York, NY, and its President and Chief Operating Officer, Andrew Murstein of New York, NY, with illegally engaging in two schemes in an effort to reverse the company’s plummeting stock price. According to the SEC’s complaint, Medallion’s […]
Consultant to Biotech Company Settles Insider Trading Claim
You cannot trade on material, non-public information you obtained as a result of your employment or as an outside consultant. Period, end discussion. By Mark Astarita While the SEC‘s complaints are simply allegations, which need to be proven in court, the fact that an employee is charged with insider trading […]
