United States

Topic: Enforcement

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New FinTech Pulse podcast: US federal regulators’ regulatory enforcement activity against crypto exchanges

In a special edition of our FinTech Pulse podcast series, US partners Stephen Aschettino, Andrew Lom and Kevin Harnisch discuss the recent uptick in regulatory enforcement activity from federal regulators against crypto exchanges, with the SEC issuing a Wells Notice to Coinbase and suing Beaxy, and the CFTC suing Binance and seeking permanent injunctions to … Continue Reading

DAO token holder personal liability continues to take center stage for the CFTC

A seemingly straightforward enforcement action by the Commodities Futures Trading Commission (CFTC) has attracted the attention of US regulators, large digital asset industry players and the crypto industry in general for its potential wide-reaching implications for DAO governance. The CFTC pushed back on various amicus briefs filed by top industry participants in the digital asset … Continue Reading

Another sky-high settlement: Airline fined more than US$150m for FCPA violations

On September 15, 2022, the Department of Justice (DOJ) and the United States Securities and Exchange Commission (SEC) announced that GOL Linhas Aéreas Inteligentes S.A. (GOL), an airline headquartered in São Paulo, Brazil, agreed to pay more than US$150m to resolve parallel investigations by criminal and civil authorities in the US and Brazil, stemming from … Continue Reading

US DOJ announces corporate criminal enforcement policy revisions

Following Deputy AG Lisa Monaco’s remarks at the White Collar Conference last year, the Department of Justice (DOJ) created a Corporate Crime Advisory Group to revise DOJ’s Corporate Criminal Enforcement Policies. On September 15, 2022, Monaco announced the group’s first major round of revisions. The revisions reiterate a focus on individual accountability, voluntary disclosure, and … Continue Reading

US SEC prevented from expanding fraudulent scheme liability

In a decision with significant implications for securities litigation and enforcement, the United States Court of Appeals for the Second Circuit recently rebuffed an attempt by the US Securities and Exchange Commission (SEC) to broaden the scope of “scheme liability” under Section 10(b) of the Securities Exchange Act of 1934 and Section 17(a) of the … Continue Reading

ESG – Key regulatory risks for financial services firms in the UK and US and how to manage them

Investors are increasingly seeking sustainable financial products and ESG investing, traditional investing combined with sustainable or otherwise philanthropic aims, has seen huge growth in recent years. Regulated firms are also seeking to improve their own ESG performance more generally to build stronger relationships with their stakeholders, including those who use their services. Whilst the growing … Continue Reading

Return of the monitorship: SEC and DOJ settle US$84M FCPA claims and impose monitorship on medical waste services company

In October 2021, Deputy Attorney General Lisa Monaco announced revised US Department of Justice (DOJ) guidance on corporate monitorships, signaling a sharp change in the declining trend of the tool over the past few years. (NRF has previously examined the DOJ’s policy changes.) Recently, the DOJ and the US Securities and Exchange Commission (SEC) announced … Continue Reading

NRF contributes chapter to GIR’s Practitioner’s Guide to Global Investigations

The UK and US white-collar crime teams have again authored the chapter Production of Information to the Authorities in the sixth and latest edition of Global Investigations Review – The Practitioner’s Guide to Global Investigations. Information requests from regulators continue to raise a host of complex legal and practical issues for entities and individuals. The chapter sets … Continue Reading

Financial Institutions – Regulatory outlook for 2022

As 2021 draws to a close, we look ahead to the trends and new requirements that we may see over the next twelve months for financial institutions (FIs) in the white collar crime sphere as regulators, legislators and individuals continue to adapt to the pandemic and prevailing public opinion. 1. An increase in fraud-related investigations … Continue Reading

US Congressional subcommittee expands its investigation into FinTech companies and pandemic fraud

Like the US Department of Justice, Congress is sharpening its focus on lenders and FinTech companies who facilitated pandemic-relief programs. In the latest development, the United States House Select Subcommittee on the Coronavirus Crisis issued letters to two companies demanding documents and responses to specific questions. It is clear that investigations into pandemic-relief fraud are … Continue Reading

Employees’ use of off-channel communications – growing regulatory interest on both sides of the pond

One of the key risks that financial institutions both sides of the pond are currently grappling with relates to the use by employees of “off-channel” communications.   These are typically communications not monitored by the institution and not retained under various regulators’ business records requirements.  Despite most companies having a policy that prohibits the use … Continue Reading

Post script: Airbus subsidiary pleads guilty to corruption offence

On 28 April 2021, Airbus’ UK subsidiary GPT Special Project Management Ltd (GPT) was convicted of corruption and sentenced to pay penalties of over £30m by the Crown Court in London. This case preceded the wider investigation into Airbus culminating in its US$3.9 billion global deferred prosecution agreement in 2020 (see our previous article here). … Continue Reading

Financier Worldwide Magazine feature – Regulatory futures: challenges and opportunities in 2021

Throughout 2020 and 2021, financial services firms have had to respond and adapt to a number of regulatory challenges in an unprecedented fashion. Firms now have to navigate a diverging regulatory landscape as a result of Brexit, at the same time as continuing to respond to an array of pandemic-related risks that have arisen. Nevertheless, … Continue Reading

Production of information to government authorities: a combined US and UK review

Information requests from regulators can raise a host of complex legal and practical issues for entities and individuals. Our experts in this field have set out the key considerations around the production of information to UK and US regulators, including information-gathering powers, privilege issues and increased global data sharing. Information-gathering powers Many UK regulators have … Continue Reading

New York State imposes a $1.5 million penalty in cybersecurity breach case

On March 3, 2021, the New York Department of Financial Services (NYDFS) announced a Consent Order with a NYDFS-licensed Maine-based mortgage banker and loan servicer settling alleged violations of the NYDFS cybersecurity regulations. (In the matter of Residential Mortgage Services, Inc., March 3, 2021). As a result of the regular safety and soundness examination of … Continue Reading

SEC’s Division of Examinations Releases Risk Alert for Digital Asset Securities

On February 26, 2021, the Securities and Exchange Commission’s (“SEC”) Division of Examinations (the “Division” and formerly known as “OCIE”) released a Risk Alert (the “Risk Alert”) reminding market participants – investment advisers, broker-dealers, exchanges, and transfer agents – of the framework surrounding digital assets that are securities (“Digital Asset Securities”). The Division also set … Continue Reading

SEC Settles with BlueCrest: Algorithmic Trading and AI-Based Strategies Must be Disclosed to Investors

On December 8, 2020, BlueCrest Capital Management Limited (“BlueCrest”), a UK-based investment adviser, agreed to a $170 million settlement with the Securities and Exchange Commission (“SEC”) to settle charges involving insufficient and misleading disclosures to investors that BlueCrest was also operating a proprietary, internal fund, moving its best traders to such fund and replacing the … Continue Reading

Dealers in antiquities added to the list of businesses to be subject to AML compliance requirements

The National Defense Authorization Act was enacted on January 1, 2021, after the US Senate joined the House of Representatives in overriding a presidential veto of the bill. In addition to authorizing appropriations for the Department of Defense, the new law also contains several provisions designed to improve policies and procedures aimed at policing money … Continue Reading

Congress Expands SEC Disgorgement Authority

On January 1, 2021, the National Defense Authorization Act became effective after Congress overrode President Trump’s veto. Although unrelated to national defense issues, Section 6501 of the legislation amends Section 21(d) of the Securities Exchange Act of 1934 to double the SEC’s statute of limitations for seeking disgorgement of a defendant’s unjust enrichment from five … Continue Reading

New whistleblower provisions for reporting AML violations

The National Defense Authorization Act was enacted on January 1, 2021, after the Senate joined the House in overriding President Trump’s veto of the bill. In addition to authorizing appropriations for the Department of Defense, the new law also contains several provisions designed to improve policies and procedures aimed at policing money laundering and terrorism … Continue Reading
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