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Securities Archives

SEC Anticipates Increase in Whistleblower Tips

The Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank") is one of many laws that protect consumers from fraudulent acts committed by corporations. In order to increase transparency and expose organizations that engage in illicit activity, Dodd-Frank includes a "whistleblower program" that incentivizes individuals to come forward with information regarding possible securities law violations. If the information is original and leads to a Securities and Exchange Committee ("SEC") enforcement action in which more than $1,000,000 in sanctions is ordered, the SEC is authorized to provide monetary awards between 10 to 30 percent of what it collects to the individual.

U.S. government wants Lance Armstrong's medical records turned over

From 1999 to 2005, cycling and sports enthusiasts around the world marveled at the physical abilities of the seemingly unbeatable Lance Armstrong. During these seven years, Armstrong and his cycling team dominated the sport and earned millions of dollars in prize money and endorsement deals. However, during the early 2000s, serious accusations and questions were raised about whether Armstrong and members of his "U.S. Postal Team used performance enhancing drugs during the 2000 Tour de France."

Shareholder Class Certified in Prudential Unpaid Policy Suit

"Unclaimed property" is generally defined as a liability a company owes to an individual or entity when a debt remains outstanding after a certain period of time. Most unclaimed property is abandoned because of a change of address or name, or the death of the owner. Unclaimed property laws remit the unclaimed property to the custody of a government trust account until claimants come forward. Many current and former policyholders and heirs are unaware that they are entitled to unclaimed policy benefits. If insurance companies do not handle these liabilities appropriately, several consequences concerning policyholders and shareholders can occur.

SEC ruling takes aim at government contractors who attempt to silence whistleblowers

According to USAspending.org, during 2015 the U.S. government will pay contractors more than $286 billion dollars. While many private U.S. companies that do business with the government are honest and law-abiding in their practices, others attempt to defraud the government, and taxpayers, out of millions of dollars by overcharging for goods and services or failing to reimburse for overages.

Recent appeals court ruling viewed as a win for would-be insider traders and tippers

Serving as the home of Wall Street, the New York Stock Exchange and several successful investment firms; New York City is widely considered the country's financial epicenter. Given this title, it's no surprise that the state's U.S. Court of Appeals has been referred to by Supreme Court Justice Harry Blackmun as the "'Mother Court' for securities law."

Pair of Class Actions Allege Widespread Treasury Auction Manipulation

July witnessed the filing of two nationwide class action lawsuits alleging collusion by prominent financial institutions to manipulate auctions for U.S. treasury bills, notes, bonds, and other instruments ("treasury securities"), with significant injury to investors and an extensive impact on the U.S. economy. ,

Texas Court Certifies Class in Landmark Securities

On July 25, 2015, Federal Judge Barbara G. Lynn of the United States District Court for the Northern District of Texas granted in part, and denied in part, class certification in Erica P. John Fund Inc. et al. v. Halliburton Co. et al., No. 3:02-cv-01152 (N.D. Tex. July 25. 2015), a case that has twice been heard by the Supreme Court of the United States and stands to clarify certification requirements in securities class actions. Plaintiffs allege that Defendant, Halliburton Company, misrepresented certain financial liabilities related to asbestos claims in order to inflate its stock price (a violation of SEC Rule 10b-5) and, accordingly, seek relief for a putative class of shareholders.

Sprint to Pay Out $131 Million to Settle Investor Class-Action Lawsuit

Six years ago a group of investors brought a class-action lawsuit against Sprint, accusing the wireless carrier of fraudulently inflating bond and stock prices after the company merged with Nextel Communications in 2005. The lead plaintiffs claimed they were defrauded, with damages estimated at $1.079 billion.

SEC Proposes Rule to Regulate High-Frequency Trading Outlets

The Securities and Exchange Commission ("SEC") has proposed a new rule that will attempt to bring firms that engage in high-frequency trading ("HFT") under regulatory supervision. "The proposed amendments to Rule 15b9-1 would eliminate the current proprietary trading exemption and replace it with a narrower rule to exempt only off-exchange transactions by floor-based dealers that are solely meant to hedge the risks of its floor-based activities."1 Specifically, the SEC is proposing that brokers and brokerage firms that are not trading on exchanges to join a national securities association, bringing them under the oversight of the Financial Industry Regulatory Authority ("FINRA").2