100% of S&P 500 Boards are Now Diverse

Racial and Ethnic Diversity on U.S. Corporate Boards – Progress Since 2020

As the following graph demonstrates, 2022 has set a record by being the first year when all S&P 500 companies included at least one racially/ethnically diverse director, with the number of non-diverse S&P 500 boards going from 11 percent in 2020 to 5 percent in 2021 and zero in 2022. A record 36 percent of S&P 500 companies now have three racially/ethnically diverse directors on board. And 31 percent of companies have four racially/ethnically diverse directors.

SEC Action Against CCO Raises Many Questions

The order presents several problems for the industry.

First, there are three missing players in this drama: the “bad guy” who engaged in undisclosed OBA(s) and who hasn’t apparently been sanctioned, the IAR’s supervisor who presumably could have ordered him to complete those missing forms, and the CCO’s supervisor.

Second, it’s not clear how the RIA violated the Advisers Act by failing to adequately monitor compliance with the BD’s policies. The RIA appears to have taken on an unnecessary obligation, and a failure to comply with an unnecessary obligation doesn’t mean that the RIA’s compliance program wasn’t reasonable. Indeed, firms often fail to follow their procedures, and they are not sanctioned. If there were investor protection considerations, presumably, the BD was responsible for enforcing its own policies.

Finally, with regard to the CCO, many questions are unanswered: (1) what steps did the CCO take that were insufficient; (2) did he have the actual responsibility, ability or authority to take “sufficient” steps; (3) why didn’t he take additional steps; and (4) how did the order take into account that the CCO eventually reported the OBA?

Raj Rajaratnam Is Out of Jail and Hunting for His Next Big Trade – Bloomberg

…To hear Rajaratnam tell it, Bharara used the power of his office to win at all costs and advance his own career. He mentions Bharara 325 times in his 333-page book.

Bharara today says he doesn’t care what Rajaratnam thinks. In an email, the former prosecutor called the hedge funder he put away possibly “the least sympathetic defendant ever.”

Says Bharara: “Raj Rajaratnam was a privileged billionaire who engaged in massive insider trading, and there was an avalanche of evidence to prove it.” Bharara pointed to Rajaratnam’s failure to win over jurors and judges, despite an aggressive and costly defense.

“Whatever fairy tales he may now tell to rehabilitate his reputation or settle scores or peddle his book, Raj Rajaratnam was and is guilty. Period,” wrote Bharara, who was fired by Donald Trump in 2017.

Judge in Twitter v. Musk once made rare ruling: ordering a deal to close

Kathaleen McCormick took over the role of chancellor or chief judge of the Court of Chancery last year, the first woman in that role. On Wednesday, she was assigned the Twitter lawsuit which seeks to force Musk to complete his deal for the social media platform, which promises to be one of the biggest legal showdowns in years.

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Last year, McCormick got the attention of Wall Street dealmakers by ordering an affiliate of private equity firm Kohlberg & Co LLC to close its $550 million purchase of DecoPac Holding Inc, which makes cake decorating products.

She described her ruling as “chalking up a victory for deal certainty” and rejected Kohlberg’s arguments that it could walk away because of a lack of financing.

SEC Awards Whistleblowers More Than $6 Million

In the first order, the SEC issued an award of more than $3 million to a whistleblower who was solicited to invest in a product that they believed was being misrepresented. The individual expeditiously alerted the SEC to the potential misconduct, which prompted the opening of the investigation, and continued to cooperate with the SEC’s Enforcement staff.

In the second order, the SEC awarded a whistleblower more than $3 million for providing information that prompted the opening of an investigation. The whistleblower, an insider, initially reported their concerns internally, and later submitted a detailed tip and met with the SEC’s Enforcement staff multiple times to provide additional information during the investigation.

The Gap In SEC Individual FCPA Enforcement Actions Is Approaching Two Years

For many years, SEC enforcement officials have talked about the importance of individual FCPA enforcement actions and set forth below are representative quotes from over the years.

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The last individual FCPA enforcement action by the SEC occurred on October 14, 2020 (a gap that is approaching two years) – see here.

This nearly two year gap is the most significant gap in individual FCPA enforcement by the SEC in nearly a decade.

Since late October, 2020 there have been seven corporate SEC FCPA enforcement actions and none of them have involved related actions against individuals.