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SEC Charges Hedge Fund with 13D Violation

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The SEC charged a hedge fund sponsor that manages private funds and separately managed accounts focused on global distressed, special situations, and opportunistic investing with failure to timely file a Schedule 13D. The hedge fund had previously reported its holding on Schedule 13G. The hedge fund had a senior managing... Read More

Topics: Investment Advisers, Litigation, Private Equity, Public Companies and Securities

SEC Targets Perqs in Another Enforcement Action

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The SEC has targeted disclosure of executive perquisites in another settled enforcement action.  According to the SEC, the issuer did not follow the Commission’s standard regarding disclosure of perquisites, which provides that: An item is not a perquisite or personal benefit if it is integrally and directly related to the... Read More

Topics: Employment, Executive Compensation, Litigation, Public Companies and Securities

Supreme Court Finds Appointment of SEC ALJs Unconstitutional – What’s Next?

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In Lucia v. Securities and Exchange Commission, the SEC brought an administrative action before one of its administrative law judges, or ALJ’s, against Raymond Lucia for allegedly using misleading slide presentations to deceive prospective investors using a retirement savings strategy called “Buckets of Money.”  The ALJ that adjudicated the case... Read More

Topics: Litigation, Public Companies and Securities

House Subcommittee Reviews Legislation that would Fundamentally Alter Securities Litigation

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The House Subcommittee on Capital Markets, Securities, and Investments held a hearing which reviewed two pieces of legislation that have been introduced: H.R. 2128, the “Due Process Restoration Act of 2017,” introduced by Representative Warren Davidson (R-OH), would amend the Securities and Exchange Act of 1934 to permit private persons... Read More

Topics: Litigation, Public Companies and Securities

“True Lender” Litigation on the Rise: Recent Litigation and Enforcement Actions Challenge Traditional Bank Partnership Model

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Over the last two years the financial industry has seen an uptick in litigation and enforcement actions aimed at banks and their non-bank lending partners. These actions have primarily challenged the validity of the bank partnership model that is used by many non-bank lenders to generate consumer and small dollar... Read More

Topics: Banking, Consumer Protection, Litigation

Fintech Company Subject to SEC Enforcement Action for Exceeding Rule 701 Option Grant Limit

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Subject to its limits, Rule 701 permits non-reporting companies to grant employees equity without registration under the Securities Act of 1933.  One component of Rule 701 requires certain disclosure materials to be delivered to employees if the aggregate sales price or amount of securities sold during any consecutive 12-month period... Read More

Topics: Employment, Executive Compensation, Litigation, Public Companies and Securities