2021 AML Trends and Developments (Part I of III)

by Franca Harris Gutierrez, Boyd Johnson, Bruce Newman, Michael Dawson, Zachary Goldman, Rachel Dober, Michael Romais, Alina Lindblom, and Andrew Miller

Anti-money laundering (“AML”) issues have been a focus of regulators and law enforcement for the past decade and will likely continue to be a priority issue area for the Biden Administration. The AML landscape is shifting considerably as a series of regulatory actions in the last months of 2020 and the January 1, 2021 passage of the National Defense Authorization Act for Fiscal Year 2021 (“NDAA”)[1] — adopted with bipartisan support overriding President Trump’s veto—bring real change to the regulatory environment at the start of the new administration. Indeed, the NDAA is the most significant amendment to the AML landscape in a generation, since the adoption of the USA PATRIOT Act, and will require extensive implementation by the Treasury Department. The regulatory and legislative changes together have two principal themes: (i) a conscious effort to evolve AML compliance and the Bank Secrecy Act and its implementing regulations (collectively, the “BSA”) to make the system more efficient and effective; and (ii) adapting the BSA to a new generation of threats.

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Antitrust and Competition: Investment Firms’ Voting Rights—The Devil is in the Potential Antitrust Liability

by Frédéric Louis, Anne Vallery, Álvaro Mateo Alonso, and Édouard Bruc

On January 27, 2021, the Court of Justice of the European Union (“CJEU”) issued an important  ruling regarding an investment fund’s liability for the cartel behaviour of an affiliate. The CJEU confirmed that an investment fund is liable under Article 101 of the Treaty on the Functioning of the European Union based on holding 100% voting rights over an indirect affiliate that participated in a cartel, even though the fund held well below 100% equity in that affiliate during part of the relevant period (see here). This judgement tips the scales towards enforcement and away from key defence principles such as the presumption of innocence, or the requirement to sanction only the actual offender. Nonetheless, it sheds some useful insight for financial investors to mitigate antitrust exposure. Continue reading →

The Key Open Questions That Will Determine the Next Four Years of SEC Enforcement

by Charles D. Riely and Michael F. Linden

As President Biden’s administration gets into full swing, many expect future Chairman Gary Gensler’s SEC to take a more aggressive approach to enforcement. Public companies and other market participants are left wondering what, exactly, that means. In this post, we take a detailed look at where the SEC is starting from, what has happened since January 20th, where it goes from here, and what interested parties should be watching for as the “new” SEC ramps up. Continue reading →

ESG: Key Trends in 2020 and Expectations for 2021 (Part III of III)

by Marc S. Gerber, Scott C. Hopkins, Simon Toms, Helena J. Derbyshire, Louise Batty, Adam M. Howard, Greg P. Norman, Damian R. Babic, Zoe Q. Cooper Sutton, Kathryn Gamble, Sym Hunt, Caroline S. Kim, Abigail B. Reeves, Patrick Tsitsaros, and Eleanor F. Williams

This is Part III of a three-part post. For Part I, looking back at important trends and topics in 2020, please click here. For Part II, discussing the first 5 of 10 key trends expected in 2021, please click here.

Below are the final 5 of 10 key environmental, social and governance (ESG) trends and topics that we expect to be prominent in 2021, some of which are continuing trends from 2020, while others may emerge in response to the events of 2020.

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SEC Changes Enforcement Practice for Settlement Offers in Cases Involving Waivers

by Greg D. Andres, Martine M. Beamon, Angela T. Burgess, Tatiana R. Martins, Uzo Asonye, Robert A. Cohen, Neil H. MacBride, Fiona R. Moran, Paul J. Nathanson, and Kenneth L. Wainstein

Parties considering whether to settle an SEC enforcement investigation or criminal proceeding have a reasonable expectation that they will know the likely consequences of a settlement.  This includes whether they can expect to receive a waiver from certain statutory disqualifications.  Last week, however, the Acting Chair of the SEC announced that the Enforcement Division will not recommend any settlement offer that is conditioned on the settling party receiving a waiver.  If this statement reduces transparency between SEC staff and parties negotiating a possible settlement, the result likely will be a more difficult and protracted process for both sides as it becomes difficult for settling parties to make informed decisions about the full implications of a resolution. Continue reading →

New York State Department of Financial Services (“DFS”) Uses New Powers to Investigate Alleged Price Spikes in COVID-19 Medicines, Where Targeted Pharma Manufacturers Are Not DFS Licensees

by Matthew Levine

Continuing its focus on consumer protection enforcement, the New York State Department of Financial Services (“DFS”) recently announced an investigation into alleged price spikes for six drugs connected to treatments of COVID-19 medical conditions.[1]  According to DFS, its newly-formed Office of Pharmacy Benefits (“OPB”) commenced the investigations under Insurance Law § 111 into what it characterizes as “anomalously large spikes” in the prices of the six drugs, occurring since the onset of the COVID-19 pandemic.  These medications are Ascor, Budesonide, Dexonto, Mytesi, Duramorph and Chloroquine phosphate, each of which has some actual or claimed therapeutic use for COVID-19 conditions.

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ESG: Key Trends in 2020 and Expectations for 2021 (Part II of III)

by Marc S. Gerber, Scott C. Hopkins, Simon Toms, Helena J. Derbyshire, Louise Batty, Adam M. Howard, Greg P. Norman, Damian R. Babic, Zoe Q. Cooper Sutton, Kathryn Gamble, Sym Hunt, Caroline S. Kim, Abigail B. Reeves, Patrick Tsitsaros, and Eleanor F. Williams

This is Part II of a three-part post. For Part I, looking back at important trends and topics in 2020, please click here. 

Below are the first 5 of 10 key environmental, social and governance (ESG) trends and topics that we expect to be prominent in 2021, some of which are continuing trends from 2020, while others may emerge in response to the events of 2020.

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NYDFS Uses New Powers to Investigate Alleged Price Spikes in COVID-19 Medicines, Where Targeted Pharma Manufacturers Are Not NYDFS Licensees

by Matthew Levine

Continuing its focus on consumer protection enforcement, the New York State Department of Financial Services (“DFS”) recently announced an investigation into alleged price spikes for six drugs connected to treatments of COVID-19 medical conditions.[1]  According to DFS, its newly-formed Office of Pharmacy Benefits (“OPB”) commenced the investigations under Insurance Law § 111 into what it characterizes as “anomalously large spikes” in the prices of the six drugs, occurring since the onset of the COVID-19 pandemic.  These medications are Ascor, Budesonide, Dexonto, Mytesi, Duramorph and Chloroquine phosphate, each of which has some actual or claimed therapeutic use for COVID-19 conditions.

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With Lava Jato Closing Up Shop, What Comes Next?

by Sean Hecker, Marshall Miller, and Ana Frischtak

The largest criminal investigation in Brazil’s history – and perhaps this century’s most important anti-corruption investigation worldwide – came to a close last week.  Operation “Lava Jato” (“Car Wash,” in English) was launched by the Curitiba[1] branch of the Brazilian Federal Police in 2014, (later known as the Curitiba Task Force).[2]  The Operation, which drew its name from a car wash in Brasília where one of the targeted criminal organizations laundered illicit funds, uncovered a widespread, complex, and unprecedented web of corruption implicating Brazil’s giant state-owned oil company, Petrobrás, public officials, and Brazil’s largest construction companies in a sweeping contracts-for-kickbacks scheme. Operation Lava Jato ultimately expanded to expose bribery and graft in numerous other industries, involving dozens of politicians and government officials, and an almost countless number of companies, both Brazilian and multinational.

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ESG: Key Trends in 2020 and Expectations for 2021 (Part I of III)

by Marc S. Gerber, Scott C. Hopkins, Simon Toms, Helena J. Derbyshire, Louise Batty, Adam M. Howard, Greg P. Norman, Damian R. Babic, Zoe Q. Cooper Sutton, Kathryn Gamble, Sym Hunt, Caroline S. Kim, Abigail B. Reeves, Patrick Tsitsaros, and Eleanor F. Williams

In a tumultuous year, one of the key clear messages to emerge from 2020 was that environmental, social and governance (ESG) concerns are here to stay. As mentioned in our 31 July 2020 article “ESG in 2020: A Half-Year Review,” although many investors feared that the focus on ESG policies would fall away in the face of an economic crisis, the opposite appears to have occurred. The pandemic instead has triggered a debate on what societies really value, and at the same time exposed the extent of global interconnectedness and the “tragedy of the horizon” whereby societies fail to plan in the longer term and only address issues when it is too late. This focus continued throughout 2020 and, as a result, many now regard the coming months and years as an opportunity to rebuild economies with ESG matters, corporate purpose and sustainability firmly placed at the fore. In this three-part post, we review the key trends that emerged in 2020 and continued to develop in the second half of the year. We then set out our expectations for the trends that will emerge or continue in the ESG sphere over the coming year.

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