As we have observed, in its early days, the Trump Administration has stressed its intention to maintain continuity in white-collar enforcement, including through its recent extension of the FCPA Pilot Program. Consistent with that approach, the first FCPA action under the new administration was a Pilot Program declination, closing an investigation without enforcement action other than disgorgement. Continue reading
Earlier this week, the United Kingdom’s Serious Fraud Office (“SFO”) charged Barclays, its former CEO, and three other former top executives with criminal fraud. The prosecution stems from a long-running inquiry into whether Barclays failed to adequately disclose 322 million paid to Qatari investors in late 2008, during a period when the bank received billions in funding from affiliates of the Qatari government. Investigators reportedly examined whether Barclays and its former executives arranged for portions of the payments to be funneled into the Qatari bailout, in violation of British law. Despite this novel action, market reaction was muted, with Barclays’ shares trading in line with other U.K. banks. Continue reading
As ever-increasing cyber attacks target companies in the financial sector and beyond, financial regulators in New York and Washington, D.C. have focused their attention on cybersecurity risk. On October 19, federal banking regulators sought comments (PDF: 506 KB), due January 17, 2017, on enhanced cyber risk-management standards for major financial institutions. Meanwhile, the New York State Department of Financial Services (DFS) recently announced detailed regulations, requiring covered institutions — entities authorized under New York State banking, insurance, or financial services laws —to meet strict minimum cybersecurity standards. And yesterday, the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an advisory (PDF: 332 KB) on the reporting of cyber events under the Bank Secrecy Act. Continue reading
In the space of one week, the SEC brought two enforcement actions that reiterate its focus on protecting the rights of whistleblowers. In each case, companies attempted to remove the financial incentives for departing employees to submit whistleblower reports to the SEC. The result instead was a pair of administrative orders (on a neither admit nor deny basis) finding that each company violated SEC Rule 21F-17, which prohibits any person from taking any action to impede a whistleblower from communicating with the SEC about possible securities law violations. In the Matter of BlueLinx Holdings Inc. (August 10, 2016) (PDF: 224 KB); In the Matter of Health Net, Inc. (August 16, 2016) (PDF: 160 KB). For earlier developments in this area, see our memo, “The SEC Opens a New Front in Whistleblower Protection” (April 2, 2015) (PDF: 59 KB).
Both recent cases involved severance agreements entered into with individuals in connection with the termination of their employment relationship, as a condition to the receipt of severance payments and benefits. Continue reading