Crypto-Related Ransom Payments Nearly Doubled in 2023, to Over $1 Billion

Crypto ransom attack payments hit record $1 billion in 2023 – Chainalysis

Payments from crypto-related ransom attacks nearly doubled to a record $1 billion in 2023, blockchain analytics firm Chainalysis said on Wednesday.

Scammers targeting institutions such as hospitals, schools and government offices for ransom pocketed $1.1 billion last year, compared with $567 million in 2022.

Voyager Investor Suit Against Firm Shows Risk of Crypto Advice

A lawsuit targeting McCarter & English over failed exchange Voyager Digital Holdings Inc. shows the risk firms face when giving advice in the fast-changing—and sometimes dizzying—world of crypto.

***

Lawyers found themselves in “uncharted territory” as crypto’s popularity led corporate firms to launch practices, said James Cox, a Duke University law professor. Opinions on whether a crypto asset is an investment contract under federal law demand a “very big caveat” because “it’s not a settled question,” he said.

***

The proposed class action against McCarter & English, led by the Moskowitz Law Firm, represents at least the second complaint targeting a law firm that advised a failed crypto exchange. Fenwick & West last year faced an investor complaint alleging its work for FTX was “central” to the crypto firm’s fraud.

Fenwick & West has sought to dismiss the suit, arguing it’s being targeted for routine legal services.

Musk Can Fume, But He Probably Can’t Leave Delaware

Elon Musk was unhappy, to put it mildly, with the ruling last week from a Delaware court that invalidated a $55.8 billion pay package he received from Tesla, his electric car company.

Shortly afterward, he threatened to move Tesla’s incorporation out of Delaware to a less shareholder-friendly state. But, as we discuss in this episode of our news podcast, On The Merits, doing so will likely just land Musk back in the same Delaware court that’s the target of his current ire.

Bloomberg Law reporters Mike Leonard and Jennifer Kay explain why this court voided Musk’s massive pay package, and why the things about Delaware that aggravate him are also what make it the corporate home for nearly every public company in America.

Ex-Goldman Sachs Analyst Denies Insider Dealing Allegations

An ex-Goldman Sachs Group Inc. analyst accused of using confidential information to trade in the likes of ARM Holdings Plc shouldn’t be found guilty because he didn’t even know he was classed as an insider by the bank, his lawyer told a London jury.

Mohammed Zina, who worked in the Conflicts Resolution Group at Goldman, is accused of using insider information to strike deals between July 2016 and December 2017, making about £140,000 ($176,480) in profit. The jury at Southwark Crown Court started deliberating on Friday after almost nine weeks of evidence.

***

“Did he know that the information that he had is inside information,” Kelly said to the jury. “The evidence on knowledge is as clear as mud.”

U.S. Senators Berate SEC’s Gensler for Agency’s ‘Unethical’ Handling of Crypto Case

The U.S. Securities and Exchange Commission’s admission that it misrepresented evidence in a lawsuit against the blockchain project DEBT Box casts doubt on its wider enforcement practices, several Republican senators argued in a letter to Chair Gary Gensler.

***

“Regardless of whether commission staff deliberately misrepresented evidence or unknowingly presented false information, this case suggests other enforcement cases brought by the commission may be deserving of scrutiny,” the lawmakers argued in the letter, dated Feb. 7 and signed by five senators on the Senate Banking Committee, including J.D. Vance (R-Ohio) and Cynthia Lummis (R-Wyo.)

Bankrupt Genesis Global settles NY Attorney General’s lawsuit

Crypto lender Genesis Global has settled a lawsuit that the New York Attorney General brought against it last year, eliminating a major legal burden as it wades through its bankruptcy proceedings.

Attorney General Letitia James had sued the company, its parent Digital Currency Group (DCG) and cryptocurrency firm Gemini Trust Co in October for allegedly “defrauding” investors of more than $1 billion.

Commercial Real Estate Woes Weigh on Bank, Lead to New Securities Suit

…As the Wall Street Journal put it in an article late last week, “Investors have wondered when the pain from the downturn in commercial property would hit banks.” As the Journal noted in the same article, the commercial property-related pain has now arrived for some banks. Several banks, including New York Community Bancorp (NYCB), suffered significant stock price drops after the banks last week announced steep increases in their loss reserves in their commercial real estate portfolios.

And now these developments have translated into securities litigation, as a plaintiff shareholder has launched a securities class action lawsuit against NYCB and certain of its executives. These developments and the filing of the lawsuit suggest while the Banking Crisis of 2023 may have been contained, continuing problems in the banking sector could be a factor in the number of securities class action lawsuit filings during the year. A copy of the February 6, 2024 complaint filed against NYCB can be found here.