Tag Archives: David B. Anders

SEC Disbands ESG Enforcement Task Force

by John F. Savarese, Wayne M. Carlin, David B. Anders, and Carmen X. W. Lu

Left to right: John F. Savarese, Wayne M. Carlin, David B. Anders and Carmen X. W. Lu. (Photos courtesy of Wachtell, Lipton, Rosen & Katz)

The U.S. Securities and Exchange Commission (“SEC”) has disbanded its Climate and ESG Task Force in the Division of Enforcement. The Task Force was established in March 2021 with the purpose of identifying ESG-related misconduct, including material gaps or misstatements in issuers’ disclosure of climate risks, and assessing disclosure and compliance issues relating to investment advisers’ and funds’ ESG strategies. According to the SEC, the “expertise developed by the task force now resides across the Division” signaling that the SEC will continue to pursue ESG-related matters as part of its broader enforcement strategy.

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Summer Takeaways in SEC Enforcement

by John F. Savarese, Wayne M. Carlin and David B. Anders

Left to Right: John F. Savarese, Wayne M. Carlin and David B. Anders (Photos courtesy of Wachtell, Lipton, Rosen & Katz)

With the Labor Day holiday now behind us, it is a good time to review the SEC’s active enforcement docket and to look ahead to likely areas of continuing enforcement attention as we head into the fall. The record over the past few months reflects a continuing emphasis on certain major program areas, along with progress on a new enforcement initiative:

Whistleblower Awards. The whistleblower program continues to be a tremendous source of investigative leads for the enforcement staff. In July and August alone, the SEC announced bounty payments to six whistleblowers totaling $196 million. These announcements included an award of $82 million to a single individual who provided information that led to the opening of an investigation. In addition, two separate whistleblowers received awards of $37 million each in connection with different matters.

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Implications of the SEC’s “Shadow Trading” Verdict

by John F. Savarese, Wayne M. Carlin, and David B. Anders

From left to right: John F. Savarese, Wayne M. Carlin, and David B. Anders (photos courtesy of Wachtell, Lipton, Rosen & Katz).

Last week, a jury in San Francisco returned a verdict in SEC v. Panuwat, finding that a corporate executive engaged in insider trading when he learned about an impending acquisition of his employer and then traded in the securities of an unrelated company in the same industry. The case has widely been described as “novel” but, in bringing this case, the SEC did not seek to extend existing law. Panuwat simply applied well-established principles of insider trading law to a new fact pattern. Yet in doing so, this action may well have implications for corporate trading policies.

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White-Collar and Regulatory Enforcement: What Mattered in 2023 and What to Expect in 2024

by John F. Savarese, Ralph M. Levene, Wayne M. Carlin, David B. Anders, Sarah K. Eddy, Randall W. Jackson, and Kevin S. Schwartz

Top left to right: John F. Savarese, Ralph M. Levene, Wayne M. Carlin, and David B. Anders.
Bottom left to right: Sarah K. Eddy, Randall W. Jackson, and Kevin S. Schwartz. (Photos courtesy of Wachtell, Lipton, Rosen & Katz)

This past year was yet another notable and intensely active one across the entire range of white-collar criminal and regulatory enforcement areas. We heard continued tough talk from law enforcement authorities, especially concerning the government’s desire to bring more enforcement actions against individuals and on the need to keep ramping up corporate fines and penalties. The government largely lived up to its talking points about increasing the numbers of individual prosecutions and proceedings, particularly with respect to senior executives in the cryptoasset industry. But there were some notable stumbles. The most striking example of this was DOJ’s failure to secure convictions in cases where it attempted to extend criminal antitrust enforcement in unprecedented areas, such as no-poach employment agreements and against certain vertical arrangements—neither of which has historically been viewed as involving per se violations of the federal antitrust laws. And, as in years past, many state attorneys general remained active throughout 2023, using broad state consumer-protection statutes to bring blockbuster cases across a wide array of industries, from ridesharing and vaping to opioids and consumer technology offerings.

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DOJ Ends No-Poach Prosecution of SCA

by David B. Anders, Carrie M. Reilly, Kevin S. Schwartz, and Yolanda Bustillo

From left to right: David B. Anders, Carrie M. Reilly, Kevin S. Schwartz, and Yolanda Bustillo. Photos courtesy of Wachtell, Lipton, Rosen & Katz.

Today, almost three years after the Antitrust Division brought criminal charges against Surgical Care Affiliates (“SCA”), the District Court for the Northern District of Texas granted the government’s motion to dismiss the indictment, with prejudice, marking the latest setback in the agency’s aggressive enforcement of labor market cases. Earlier this year, we noted that the Antitrust Division’s prosecution of criminal wage‑fixing and no-poach agreements warranted reconsideration given the many problems these cases present. The Antitrust Division’s decision to dismiss its case against SCA signals that the agency may have done just that.

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White-Collar and Regulatory Enforcement: What Mattered in 2022 and What to Expect in 2023

by John F. Savarese, David B. Anders, Ralph M. Levene, Sarah K. Eddy, Wayne M. Carlin, and Kevin S. Schwartz

(Photos courtesy of Wachtell, Lipton, Rosen & Katz) From left to right: John F. Savarese, David B. Anders, Ralph M. Levene, Sarah K. Eddy, Wayne M. Carlin, Kevin S. Schwartz.

Introduction

Each year we try in this wrap-up memo to flag the main enforcement developments that companies should be alert to in the coming year and also to identify steps companies should be taking to prepare themselves in the event of a significant white-collar or regulatory enforcement inquiry. Because policy preferences (and politics) often shape these developments, the early days of any new administration in D.C. are frequently harder to read, and teasing apart mere rhetoric from concrete changes in enforcement priorities can be challenging. But now, two years into the Biden administration, we can see some clear themes emerging: Penalties are up—way up; investigations appear to be moving a bit faster; cryptoassets and cybersecurity have become heightened risk areas; government expectations for what constitutes full cooperation have been amped up; and many new disclosure demands across a wide range of corporate activities are coming on line. At the same time, however, several time-tested verities remain firmly in place, including the need to maintain strong internal accounting controls, provide comprehensive (and frequent) training, instill a genuinely ethics-oriented tone at the top, stay vigilant in detecting internal misconduct, and react swiftly in the event problems do arise by self-remediating and self-reporting when appropriate. A company that positions itself in this way optimizes its chances not only of securing the best possible resolution in the event of criminal or civil charges but also of forcefully resisting enforcement action where warranted.

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Former Federal Prosecutors React to Sam Bankman-Fried’s Arrest

The NYU School of Law Program on Corporate Compliance and Enforcement (PCCE) is following the collapse of FTX and the civil and criminal enforcement actions arising from FTX’s and its founder’s alleged misconduct. In this post, several former federal prosecutors offer their initial reactions to the arrest of Sam Bankman-Fried (SBF) and the criminal case brought by the U.S. Attorney’s Office for the Southern District of New York (SDNY).

The photo shows the headshots of the authors of the post

From Left to Right: John Savarese, David Anders, Seetha Ramachandran, Jaimie Nawaday, and Eugene Ingoglia

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DOJ Clarifies and Refines Its Policies for Corporate Criminal Enforcement

Editor’s Note: On September 15, 2022, the Program on Corporate Compliance and Enforcement (PCCE) at New York University School of Law hosted Deputy Attorney General Lisa O. Monaco while she delivered a speech detailing significant changes to the Department of Justice’s corporate prosecution policies. The speech and accompanying policy memo are available here. Over the coming days and weeks, PCCE will be publishing reactions to the new DOJ policies by practitioners, scholars, and compliance officers.

by John F. Savarese, Ralph M. Levene, David B. Anders, and Daniel H. Rosenblum

In an important policy speech late last week, Deputy Attorney General Lisa Monaco acknowledged “the data showing [an] overall decline in corporate criminal prosecutions over the last decade.” The interesting question prompted by that data, of course, is the one no one seems to know the answer to: Is this decline in corporate prosecutions the result of efforts by well-managed companies to respond to the oft-repeated admonition to set the right tone at the top and invest extensively in compliance programs, training and personnel such that the number of corporate prosecutions actually should be coming down? Or is it because there is some lack of adequate prosecutorial effort or some other obstacle standing in the way of achieving the right level of corporate prosecutions? In the absence of any hard empirical data on that crucial question, DAG Monaco opted for the latter explanation, thus repeating the common DOJ mantra that it “need[s] to do more and move faster.”

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Second Circuit Reverses LIBOR Convictions

by John F. Savarese, David B. Anders, Sarah K. Eddy, and Remy Grosbard

In a careful but blunt opinion (PDF: 3.3 MB) yesterday, the Second Circuit reversed the convictions of two Deutsche Bank derivatives traders charged with wire fraud for manipulating LIBOR. The decision underscores that not all conduct deemed unfair is criminal, and represents the latest blow to a theory of criminal liability that DOJ has invoked to extract billions of dollars in penalties from financial institutions—all before the theory’s viability could be tested in the courts.

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SEC Division of Enforcement Forms New Climate and ESG Task Force to Target ESG-Related Misconduct and Potential Violations

by David M. Silk, Wayne M. Carlin, David B. Anders, Sabastian V. Niles, and Carmen X. W. Lu

Last week, the SEC Division of Corporation Finance announced (PDF: 131 KB) it would enhance its focus on climate-related disclosures and risks at the direction of the Acting Chair of the SEC. Yesterday, the SEC announced a new Climate and ESG Task Force within the SEC’s Division of Enforcement. This Enforcement Task Force will be heavily resourced, have access to ESG-related whistleblower complaints and referrals and focus on proactively identifying ESG-related misconduct (such as material disclosure “gaps” and misstatements), including by using data analysis to identify potential violations.

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