New DOJ Policy Offers Cooperation Credit in M&A Transactions

DOJ Offers More Incentives to Self-Report Wrongdoing in M&A Transactions

Companies can face more lenient treatment if they report to prosecutors potential criminal misconduct uncovered during the merger and acquisition process, a senior official at the Justice Department said.

Under a new policy announced Wednesday, an acquiring company that discloses potential wrongdoing at a company being acquired within six months of the deal closing date—and fully cooperates and fixes the underlying problems within a year of closing—can presume it won’t be prosecuted by the Justice Department.

‘Flight risk’ Sam Bankman-Fried’s 2 private jets worth over $28M confiscated during trial

Authorities confiscated Sam Bankman-Fried’s two private jets, worth a collective $28.4 million, as the indicted founder of now-bankrupt cryptocurrency exchange FTX — who was posed as a “flight risk” — enters the fourth day of his six-week trial. Though the government seized Bankman-Fried’s two jets in an apparent move to ensure he and his family remain grounded in the US, the 31-year-old former billionaire reportedly never even flew on the planes.

The SBF trial is a reminder that crypto is a rotten business

Those of you who do will know that Lewis has been generating almost as much controversy as the alleged criminal himself over the past week. But it wasn’t so much the book — the publication of which was timed to coincide with the beginning of SBF’s trial — that provoked the outrage; it was a clip from an interview Lewis gave on CBS’s 60 Minutes that was really getting people riled up. I was one of those people.

“This isn’t a Ponzi scheme,” he tells host Jon Wertheim in the short video. “In this case, they actually had a great, real business. If no one had ever cast aspersions on the business, if there hadn’t been a run on customer deposits, they’d still be sitting there making tons of money.”

Lewis’s take is a terrible one. To call a crypto exchange that managed to lose $8bn in customers’ money — even if this failing was somehow completely innocent and accidental — a “great business” is a bizarre and unsound assessment. In case we’ve forgotten: FTX held just 10 per cent of its liabilities in liquid assets the day before the exchange collapsed into bankruptcy. It was not allowed to do this; FTX was not a bank.

‘Math nerd’ or crypto criminal? Question at heart of Sam Bankman-Fried’s trial

A single question has dominated the first week of Sam Bankman-Fried’s fraud trial: which version of this tech bro do you believe?

Prosecutors have cast Bankman-Fried – the 31-year-old founder of the failed cryptocurrency exchange FTX – as the mastermind of a $10bn fraud, among the largest and most nefarious in American history. They say he selfishly squandered the money of customers who put their trust in FTX. He lavished the cash on ritzy properties, ill-gotten influence, glamorous travel, and the highest-profile ads, all while concealing a hidden mountain of debt, they allege.

His lawyers, by contrast, have done their best to portray him as a wayward boy genius – a “math nerd who didn’t drink or party”, according to his lawyers’ opening statement. They describe the motivation for his actions not as malice so much as inexperience with normal business operations. An observer could only wonder whether Bankman-Fried’s misshapen haircut and ill-fitting suit – purchased at Macy’s at a 40% discount, according to the Wall Street Journal – were a ploy for sympathy along the same lines.

Analysis: Why the SEC might win its latest battle with Elon Musk

In this case, the SEC is on solid ground as the law enforcing the requirements of investigative demands, or subpoenas, is clear cut, said several former SEC officials.

While the stakes are lower this time, the new case again shines a spotlight on the extraordinary feud between the world’s richest man and most powerful securities regulator, which has for years struggled to bring Musk to heel.

“This case is different from past forays between the SEC and Elon Musk because it’s a subpoena enforcement case. These cases are really cut and dry,” said Stephen Crimmins, a partner with Davis Wright Tremaine law firm and a former SEC trial lawyer.

“The law provides the SEC has subpoena power to take investigative testimony and gather documents.”

The Rise of Group Actions in the U.K and the E.U.

I will say this as a long-time observer whose observational perch includes an extensive opportunity to watch developments both within and outside the U.S. that probably the single most important thing I have observed over the years I have been watching has been the increasing rise of collective action mechanisms outside the U.S. When I first started traveling outside the U.S. for professional meetings years ago, I was often the only American in the room. I was very accustomed to hearing the U.S. class action procedures being vilified as excessive and distortive. The funny thing that has happened over time is that while the U.S. system is still ritualistically condemned, the tools and processes that many countries are adopting increasingly look like – or at least resemble in many of the key details – the U.S. class action system. Of course important differences remain. But the fact is that an increasingly number of jurisdictions have found it necessary to adopt and implement mechanisms that allow for collective redress for large numbers of claimants. I expect that this evolutionary process will continue to develop in the months and years ahead.